Experts polled by the Ministry of Economy expect a 6% fall in GDP in 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

Indicator	2020	2021
Nominal GDP	₴3,964 bln	₴4,391.4 bln
Real GDP, y-o-y	-0.06	3.2%
Consumption, y-o-y	-0.04	2.4%
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%
Agriculture, y-o-y	-2.3%	2.3%
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%