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World Bank downgrades Ukraine's 2024 economic growth forecast due to war

World Bank downgrades Ukraine's 2024 economic growth forecast due to war The World Bank has downgraded its forecast for Ukraine (Getty Images)
Author: Maria Kholina

The World Bank forecasts a 3.2% economic growth for Ukraine in 2024. While in October last year, the bank anticipated a 4.0% increase in GDP, according to the World Bank's global economic prospects.

The reports says that the prospects for Ukraine remain highly uncertain. It is projected that growth will be 3.2% in 2024 and 6.5% in 2025.

The World Bank expects that active military actions will continue throughout 2024.

However, underlying effects and one-time factors, including agricultural crop yields, will be offset.

The report also says that a partial resolution of uncertainty in 2025 will contribute to the recovery of exports and a gradual increase in investment in reconstruction.

Economic forecasts

The Ukrainian government forecasts a 5.0% GDP growth in 2023. A slowdown to 4.6% is expected in 2024.

In November, the IMF raised its projection for Ukraine's real GDP growth in 2023 to 4.5% (from the previous range of 1-3%). However, it is anticipated that growth will decrease to 3-4% in 2024 as the war continues, and risks of worsening prospects remain exceptionally high.

In October, the National Bank of Ukraine improved its forecast for real GDP growth in 2023 from 2.9% to 4.9%. Real GDP is expected to grow by 3.6% in 2024 (previous forecast was 3.5%). According to the NBU's forecast, the acceleration of economic growth to 6.0% in 2025 (previous forecast - 6.8%) will be primarily facilitated by the expected reduction in security risks.