Ukraine’s payments balance deficit reached $1.9 billion in May

It increased 6.8 times compared to the deficit in May 2021

Ukraine’s consolidated balance of payments deficit in May 2022 increased by 6.8 times compared to May 2021, to $1.9 billion, National Bank of Ukraine reported, according to Interfax-Ukraine.

The account extra in May decreased by 2.8 times compared to the same month last year, to $132 million.

Export and import of goods for the month decreased by 48.6% and 24.5%, respectively.

The main reason for the decline in exports of goods to $2.7 billion was a decrease in shipments of ferrous and non-ferrous metals by 70.2%. Exports of mineral products (in particular, iron ore) decreased by 52.9%, and engineering products – by 37.1%.

Imports of goods in May decreased to $3.7 billion. In particular, non-energy imports – by 28.7%, imports of industrial products – by 32.3%, engineering products – by 22.5%, ferrous and non-ferrous metals – by 60.7%. At the same time, energy imports grew by 1.1%.

The services trade deficit was $1 billion in May, compared to a $308 million surplus in May 2021. The export of services decreased by 9.3%.

Net lending outside Ukraine in May amounted to $133 million compared to $378 million in May 2021. Net outflow from the financial account tripled to $2.1 billion. Net inflow from public sector operations amounted to $900 million (-$62 million in May 2021).

The National Bank estimated the net inflow of direct investments at $131 million, while in May 2021 this figure was $240 million.

As of June 1, 2022, the volume of international reserves amounted to $25.1 billion, which provides import financing for 3.6 months.

Ukraine’s consolidated balance of payments deficit in 2021 reduced and reached an extra of $487 million, which is four times less than in 2020. The current account deficit was $2.1 billion, while in 2020 an extra of $ 5.3 billion was recorded.

Earlier GMK Center reported that Ukraine’s budget deficit due to the war started by the Russian Federation reaches $5 billion a month. About 35% of Ukraine’s economy was not working. More than 200 factories were destroyed, about 17% of businesses closed completely, and 60% of businesses were working at low load.