NBU downgrades Ukraine's GDP growth forecast for 2021 to 3.1%, to 3.8% for 2022
The National Bank of Ukraine (NBU) has worsened its estimate of the country's gross domestic product (GDP) growth in 2021 from 3.8% to 3.1%, in 2022 – to 3.8% from 4%, the regulator said on its official website.
"Factoring in the results of H1, high energy prices, and the worsening of the pandemic, the NBU has revised downward its economic growth forecast for 2021, from 3.8% to 3.1%," the regulator said.
As the NBU said, unfavorable conditions on the energy market and the impact of global logistic problems will continue to limit Ukraine's industrial output and curb economic recovery next year.
"Therefore, the NBU has downgraded its GDP growth forecast for 2022, from 4% to 3.8%. The economy will grow by 4% in 2023," the regulator said.
The main drivers of economic growth over the forecast horizon will be the continued global economic recovery and an increase in domestic demand, including investment demand. The NBU also predicted that the terms of trade will also remain favorable for Ukrainian exporters. The progress in vaccinations will have a positive effect as well, as it will prevent the imposition of lockdowns or other restrictions on economic activity.
At the same time, the National Bank improved the forecast for nominal GDP growth in 2021 to UAH 5.19 trillion from UAH 4.975 trillion, in 2022 – to UAH 5.75 trillion from UAH 5.485 trillion, according to the materials of the central bank.