Page 26 - UKRRptJul20

Most other sectors also showed weaker dynamics than in 4Q19. Only agriculture demonstrated a significant improvement in 1Q20, the contraction easing to 1.8% from 6.5% in 4Q19.
“The quarantine measures in place from March to May and weak external demand will push Ukrainian GDP growth further into the red in 2Q20. However, economic activity should start to recover in 3Q-4Q20 as lockdown measures are gradually eased both by Ukraine and its main trading partners. Lower interest rates and support from the IMF should also help. Still, we expect the economy to contract 5% this year,” Sberbank CIB said in a note.
Ukraine’s real GDP dropped 1.3% y/y in 1Q20, or 0.7% q/q on a seasonally adjusted basis​, to UAH845.8bn ($33.8bn), the State Statistics Service reported on June 19, adjusting upward its preliminary estimate of ​1.5% y/y, or a 0.8% qoq decline​ from 1.5% y/y growth in 4Q19.
The economy was weighed down by gross fixed investments plummeting 21.4% y/y. Private consumption advanced 8.1% y/y, but public consumption fell 9.7% y/y. Real export growth climbed to 0.9% y/y, while imports declined to 4.0% y/y growth. However, the contribution of net exports to GDP remained negative, as the nominal volume of imports exceeded volume of exports.
On the production side, the value added in most sectors of Ukraine’s economy declined in 1Q20. In particular, manufacturing declined 4.3% y/y, agriculture dropped 1.8% y/y, construction slid 4.3% y/y, transportation fell 8.6% y/y. Meanwhile, value added in trade improved 5.4% y/y​ ​The GDP deflator amounted to 5.1% 1Q20.
Ukraine’s economy probably contracted by 5% Jan-April​, compared to the first four months of last year, estimates the Economic Development and Trade Ministry. The new state budget, revised at the start of the lockdown, is based on a 3.9% contraction for the year. Yesterday, Prime Minister Shmygal presented in the Rada a plan designed to stimulate a V-shaped recovery in the second half of this year.
26​ UKRAINE Country Report​ July 2020 ​ ​www.intellinews.com