Ukraine’s GDP may drop 3.5% this year over coronavirus crisis – World Bank

“A contraction of 3.5 percent in 2020 is projected under the scenario where the virus subsides in the second half of the year, but uncertainty is high,” the World Bank stated in its latest economic outlook.

The inflation rate may grow to 8.9% in 2020.

According to the World Bank, the COVID-19 crisis is expected to impact economic activity in Ukraine through three channels in 2020.

First, disposable incomes and consumption will suffer from the sudden necessary restrictions, including the closure of service industries and transport sector.

Second, lower earnings of migrant workers due to weaker economic activity in Poland and other EU countries will also adversely impact household consumption.

Third, lower commodity prices will impact Ukraine’s exports.

At the same time, the World Bank predicts that Ukraine’s GDP may grow by 3% in 2021 and by 4% 2022 under the conditions of necessary reforms, the fight against corruption and safeguarding macroeconomic stability.

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