Expert tells how Donbas trade blockade affects Ukraine's industrial output

The trade blockade of the occupied territories of Donbas, organized by activists in January 2017, led to a 4% fall in the industrial output, says Olena Belan, a chief economist at Dragon Capital.

"The worsening of dynamics compared to 2016 was caused by the severance in the first quarter of 2017 of economic ties with Donbas, which negatively affected the production of steel, coke, coal, and iron ore, as well as electricity," Belan told UNIAN commenting on the data provided by the State Statistics Service showing a 0.1% decrease in industrial output in 2017 year on  year.

Read alsoNBU estimates losses due to Donbas trade blockadeIn her opinion, the negative factors were compensated for by the revival of sectors not affected by the severance of ties with Donbas, namely in mechanical engineering (+7.3% in 2017 by 2016), chemical (+ 17%) and food industry (+2.7%).

"We expect that industrial output will recover by 3.0% this year on the back of further growth in engineering and other industries, as well as due to the absence of negative factors related to Donbas," Belan said.