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EBRD retains its forecast for Ukraine's GDP growth in 2021

The European Bank for Reconstruction and Development (EBRD) retains the forecast for the growth of the Ukrainian economy in 2021 at 3.5%. This is reported on the bank's website.

Ukraine's GDP is expected to grow by 3.5% annually in 2021 and 2022. According to the EBRD, economic growth this year will be fostered by the grain harvest and continued normalization of business activity. But slow progress of reforms and the vaccination deployment are among the risks of the forecast.

As Dimitar Bogov, EBRD Regional Economist, comments, at the beginning of next year inflation rates will begin to move towards the National Bank's target of 5%, as the effect of the low comparative base will gradually run out. It also depends on other factors when inflation reaches the NBU's target, including global inflation. In his opinion, the inflation rate in Ukraine will get close to the inflation target near the end of 2022 or 2023.

Context. In June 2021, the EBRD released a forecast that Ukraine's gross domestic product will grow by 3.5% in 2021 and 2022.

Last year, the Ukrainian economy declined by 4%. This year, the Ministry of Economy and the government expect growth by 4.1%. The National Bank expects economic growth in 2021 by 3.1%, in 2022 by 3.8%.

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