According to the data of the Ukrainian Ministry of Economy, the Ukrainian economy fell by 30% in the first 3 quarters of 2022 compared to the first 3 quarters of 2021.
The biggest role in this is, of course, the Russian invasion of Ukraine. But also the poorer grain harvest and the situation regarding the Zaporizhzhia nuclear power plant, which is the subject of much conjecture as to which side is blasting it in a recent article we informed you that even the backup generators had to be switched on as a safety measure.
There has been an improvement in exports
Gradually we can see an improvement in exports. In September we saw a 23% increase, the highest level since the start of the war.
The Ministry commented on the situation.
“The situation at the front improved in September, but the enemy continued shelling Ukrainian territory, which put pressure on business sentiment and logistics. Further destruction of production facilities, infrastructure, and residential buildings.”
Interest rates are at a seven-year high
At its last meeting, the Central Bank of Ukraine kept interest rates at 25%, a seven-year high, and the central bank said this level could last until the second quarter of 2024. However, inflation is likely to rise further this year to more than 30%.
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According to preliminary estimates, inflation is expected to slow to 20.7% in 2023. In 2024 to 9.4% and the following year to 5%. Even at the end of 2022, the economy should be down about 30% year-on-year. In 2023 and 2024, however, it should start to gradually grow by 5-6%.
Of course, everything will depend on the course of the war with Russia and also on Ukraine’s cooperation with other international partners.