Ukrainian market overview

In the 2014-2015 Ukrainian market, economy in general and politics experienced the crisis which caused the 16% decline. Now Ukrainian economy shows growth 2% per year. The changes were caused primarily by the reforms of the first technocratic government. The economy growth in 2016 was caused first of all by the revitalization of domestic investment activities, modest household consumption. The agricultural industry and domestic demand growth continued to the growth of the fuel industry by 3.3 % in 2018 and 3.2 % in 2019. In 2021 the Ukrainian economy slowly recovered with 3.6% growth despite the spread of Covid-19.

As for the global trade – Ukraine showed a significant growth in imports. As a result a $6.2 billion trade deficit appeared. Nevertheless it is $4.2 billion improvement in comparison with the previous year.

Trade balance in services is expected to increase by approximately 6 % to $16.4 billion. Ukraine is going to become an IT (information technology) leader.

In general the past economic growth was slow, but in this market overview we would like to highlight the bright spot of the significant development – agriculture. It generated around 9.3% of GDP in 2020. In plans for 2021 – to harvest more than 76 million tons of grain comparing with 65 million tons in 2020. Ukraine is one of the world production leaders of wheat, barley and corn. Stable agriculture growth gives good opportunities for the exporters of machinery, agricultural equipment, fertilizers and seeds.

Since 2016 the stabilization and recovery of the Ukrainian economy were supported by the IMF – International Monetary Fund. In June 2020 IMF agented a 18-month $5 billion stand-by. The first tranche of $2.1 billion in concessionary loans was transferred as a support in Covid pandemic.

Due to reform setbacks, Ukraine has not yet qualified for a second transfer planned for September 2021.  On August 23, 2021, Ukraine received $2.7 billion credit from IMF Special Drawing Rights under a worldwide program to support the global economy during the Covid pandemic. Future IMF disbursements will depend on fulfilling reform commitments in the areas of judicial reform, anti-corruption and fiscal discipline.

According to the IMF, per capita GDP in Ukraine is just 13% of the EU average in 2020 and the lowest level of all Eastern European countries. The IMF expects the more sustainable, inclusive and faster growth to return the lost economy positions improve living standards in Ukraine.

The Ukrainian population experiences a significant decline primarily to the low birth rate and emigration. The population in July 2021 was around 41.4 million people. By age: 0-14 – 15.2%, 16-59 – 17.4%, 65+ – 17.4%.