News State macroeconomics 10 September 2020
Experts consider a second wave of the COVID-19 pandemic in H2 2020 is highly possible
Expert organizations polled by the Ministry for Development of Economy, Trade and Agriculture downgraded a forecast for a fall in Ukraine’s real gross domestic product in 2020 by 1.8 percentage points, from 4.2% to 6%, according to the data of the Ministry of Economy’s consensus forecast for July.
“Ukraine shows a deeper decline than the global economy, reaching 6% in 2020,” the consensus forecast says.
At the same time, experts expect the economic growth to resume in 2021 and amount to 3.2% until the end of the next year, not 2.4% as expected earlier.
Key indicators of the consensus forecast for 2020–2021, median value
|Nominal GDP||₴3,964 bln||₴4,391.4 bln|
|Real GDP, y-o-y||-0.06||3.2%|
|Exports of goods and services, y-o-y||-8.2%||4.2%|
|Imports of goods and services, y-o-y||-13.3%||8.1%|
|Industrial production, y-o-y||-7.9%||2.2%|
|Consumer price index, December on December||105.8%||1.06|
|Consumer price index, year average||103.1%||106.8%|
|Producer price index, December on December||1.08||107.1%|
|Producer price index, year average||98.1%||107.3%|
Besides, experts interviewed by the Ministry of Economy improved inflation forecast for 2020 by 1.2 percentage points.
Average yearly rate in 2020 is expected to be ₴27/$1. Next year, experts forecast devaluation to ₴28.6/$1 on average.
“All elements of demand will show negative trends, but the biggest drop is anticipated in investment, down to 14.8% from 20.3% in the previous consensus forecast,” the document says.
Experts also downgraded unemployment growth forecast for this year from 9.4% to 9.6%, with a downfall to 9.2% next year.
Among the main assumptions of the consensus forecast is the high possibility of a second wave of the COVID-19 pandemic in H2 2020.
The consensus forecast was prepared on the basis of updated estimations by experts of the Ministry of Economy, Ministry of Finance, National Bank, and over a dozen of governmental and non-governmental organizations and companies.
As GMK Center reported earlier, in mid-April, the Ministry of Economy downgraded its forecast for a real GDP fall to 4.2% in 2020. In early August, the Ministry of Economy estimated a drop in Ukraine’s real GDP in H1 at 6.5%