GDP decline in 2020 due to low investment activity in real sector – Economy Ministry

Ukraine's Ministry for Development of Economy, Trade and Agriculture says the decline in the country's gross domestic product (GDP) in 2020 was formed by low investment activity in the real sector of the economy due to losses incurred by businesses.

That is according to a statement published on the ministry's website on March 23, with reference to the State Statistics Service.

"A deep drop in the main components of GDP was observed with regard to investment demand. The fall in GDP was also due to negative results of foreign economic activity due to relatively low external demand and global protectionist trends, which did not allow domestic producers at the year-end to take advantage of a certain resumption of growth in world prices on commodity markets," the ministry said.

Read alsoUkraine boosts exports, imports of goods in Jan-FebExports of goods and services at the end of 2020 declined by 5.6%, while relevant exports slumped by 9.6%.

In terms of industries, the quarantine affected services most significantly. In particular, the scope of catering services shrank by 28.5%, while transportation industry declined by 16.4%.

Industries focused mainly on the domestic market incurred significantly lower losses, the report said.

Meanwhile, urban construction, wholesale and retail trade, as well information and communications sectors boosted their production by 5.2%, 4.9%, and 2.3%, respectively.

Background

Ukraine's real gross domestic product decreased by 4% in 2020 against 2019.