Industrial production in Ukraine decreased by 2.9% y/y in the first half of 2023

Since March 2023, industrial production has shown growth in annual terms

Industrial production in Ukraine in January-June 2023 decreased by 2.9% compared to the same period in 2022. The economic activity of enterprises helped compensate for a significant part of the fall in industrial production in the first half of 2022 – then this figure decreased by 31.9% year-on-year.

On the other hand, industrial production in the first half of the year was unable to demonstrate positive dynamics, despite the high level of economic recovery in the second quarter of 2023. Thus, according to the State Statistics Service, Ukraine’s real GDP in the second quarter of 2023 grew by 19.5% year-on-year.

At the same time, industrial production began to recover in monthly dynamics in March. In March, the figure immediately increased by 51.2% compared to the same month in 2022, but in April-June the recovery slowed to 18.2%, 17.9% and 13.7%, respectively.

The decline in production in the iron and steel sector is one of the highest in the industry. Thus, steel production in the first half of the year decreased by 31.4%, and steel ore mining – by 28.7%. For example: the sector of supply and distribution of electricity and gas showed a decrease of 11.4%.

The volume of sales of industrial products (goods and services) in the first half of the year amounted to UAH 1.55 trillion, which is 6.5% more than for the same period in 2022. In the total volume of sales of industrial products in January-June, the largest share fell on the processing industry (56.2%), supply of electricity and gas (31.3%), mining industry and quarrying (11.4%).