The Ministry of Economy has improved expectations for the country's GDP in 2020 and predicts more than 7% (annualized) economic growth in the Q2 of 2021.
This is stated in the Economic Activity Survey, published on February 12.
The Ministry notes that, among other things, the expansion of the "Available loans 5-7-9%" program, the payment of benefits for temporary disability and the easing of quarantine influenced the improvement of the economy. However, the recovery dynamics is uneven across industries.
The Ministry of Economy believes that by the end of 2020, GDP declined by 4.2%, and not 4.8%, as previously reported.
In the Q1 of 2021, the GDP forecast remains at the level of a decline of 2.5-3%. This is due, in particular, to the consequences of the lockdown introduced in January. However, state support of the economy and flexibility of industries, together with the start of vaccinations, will push the economy's growth in the Q2.
Context. The National Bank has improved its estimate of the decline in Ukraine's GDP in January-March 2021 to 0.1% compared to 1.9% in the October forecast. It also predicts economic growth of 11.3% in April-June (previously expected 9.5%). This is stated in the Inflation Report for January.