Page 26 - UKRRptOct18

Source: SP Advisors
5.1 External sector overview
Ukraine’s goods trade deficit nearly doubled in July, swelling 98.6% m/m to $1.3bn from $670mn in June , according to the State Statistics Service preliminary estimates released on September 14.
The seasonally adjusted goods trade increased 35.7% m/m amid a seasonally adjusted export decline of 7.0% m/m and seasonally adjusted import growth of 0.7% m/m.
In 7M18, the trade deficit reached $4.1bn, or a 43% y/y surge. Imports advanced 15.9% y/y, outpacing exports, which grew 12.7% y/y.
The major contributors to imports growth included machinery (19.2% y/y), energy (12.7% y/y), and chemicals (12.5% y/y). In addition, food imports surged 28.9% y/y, expanding their role in the import structure.
Export growth continues to be driven by ferrous metals (24.1% y/y growth in 7M18), machinery (19.2% y/y), and timber (32.1% y/y). Exports to the EU grew 18.7% y/y in 7M18, outpacing import growth of 13.3% y/y.
“The 7H18 goods trade deficit overshot our estimate of $3.8bn. The provisional customs statistics indicate that the trade deficit will amount to $0.9bn in August and bring the 8M18 result to around $4.8bn,” Evgeniya Akhtyrko of Concorde Capital said in a note.
“Our current projection for the 2018 goods trade deficit (according to UkrStat methodology) of $7.0bn might be too low should deficit growth be maintained at the current pace. Possibly, the boosted exports of agricultural produce could restrain trade deficit growth through the end of the year,” Akhtyrko added.
26 UKRAINE Country Report October 2018 www.intellinews.com