Ukraine industry falls 3.7% in February

Ukraine’s industrial output plunged 3.7% yoy (vs. -5.0% yoy a month ago), according to state statistics released on March 18. Core industries continued their freefall as machinery shrank 14.8% yoy, metals slid 10.9% yoy, chemical production declined 5.9% yoy and even mining contracted 1.5% yoy. At the same time, utilities reported 2.7% yoy growth.

Alexander Paraschiy: Though we see slowing rates of industry decline in February, we can hardly talk about some improvement so far. Core exporters are shrinking by double digits and given the current conflict with Russia, we can hardly expect machinery to start reviving suddenly. Hryvnia devaluation and the EU’s lifting of import tariffs lays the groundwork for industry to start strengthening by the year end. Still, we should not anticipate any comforting results in 2014 and at the moment, we are projecting a 5.1% yoy industrial output decline by the year end.