Ukraine's GDP grew by 3.5% in August: Economy Ministry explains reasons

In August 2024, Ukraine's economy experienced a 3.5% (±1%) growth compared to the same month last year. This growth rate was an improvement over the 1.1% in June and 2.7% in July but fell short of the 3.7% in May and 4.3% in April.

Source: press service for Ukraine's Economy Ministry

Details: GDP growth for the first eight months of this year is estimated at 3.9% [±1%] compared to the same period last year.

"The main drivers of economic growth were industry and positive trends in transport, construction, and domestic trade. Additionally, in August, businesses reported an improvement in their short-term activity outlook for the first time in three months.

Consumer sentiment also improved for the first time in two months. This is due to minimal rolling power outages throughout the month," explained Yuliia Svyrydenko, Ukraine's First Deputy Prime Minister and Minister of Economy.

Meanwhile, the shortage of skilled workers is detrimental to business expectations and hinders their economic activity.

Svyrydenko noted that August saw positive trends in the industry due to stable access to electricity for businesses. Many companies have set up direct electricity imports.

She also praised the work of the Ukrainian Sea Corridor and the high investment demand for engineering products and construction materials.

"The uptick in industrial activity has positively reflected in the transport sector, with an increase in domestic rail traffic and cargo handling at seaports.

The volume of building and engineering work increased in the construction sector. The main drivers of this growth were the recovery of damaged critical infrastructure and major rebuilding and repair of roads in emergency areas," the ministry stressed.

The ministry also noted that the decline in agricultural production was caused by a smaller harvest of spring crops compared to last year. This was influenced by weather conditions during the growing season and plant maturation.

Background: The Ukrainian government forecasts a slowdown in GDP growth, an increase in average wages and inflation, and a reduction in unemployment in 2025.

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