RUS full-scale war continues having a devasting impact on Ukraine’s economy
We estimate GDP growth of 1.9% for 2025 (previous edition: 2.0%) and 2.1% growth for 2026 (previously: 2.8%). For 2027, we forecast 2.6%.
Demand side: Main growth drivers are private consumption, investment activities;
strong negative contribution from net exports in 2025/26, with limited recovery in
2027, public consumption is a significant negative driver in 2026/27
Supply side: sectoral outputs in agriculture, industry, and transport decline in 2025,
limited recovery in 2026/27
Current account deficit to rise sharply: 16.2% of GDP in 2025, 20.8% 2026, 21.5% 2027
Exports stagnate, while imports continue to grow
Primary and secondary income impact reduces: Remittances are expected to decline, aid in form of grants started playing an insignificant role
Average inflation to approach target range in 2026 and to fall within the range in 2027
Budget financing under strong pressure: Cumulative deficit of USD 91 bn for 2026, 2027.
Forecast remains subject to large uncertainty related to further development of the war
