Ukraine’s economic growth in 2025 may slow down to 2% or even less. This forecast was announced by the CEO of Dragon Capital, Tomas Fiala. In comparison, in 2024, the gross domestic product grew by 2.9%.
This is reported by Business • Media
Main factors influencing the economy
According to Fiala, the reasons for the restrained growth include Russian strikes on energy infrastructure, including gas facilities, as well as the shutdown of the country’s largest mine in Pokrovsk due to the war. Among other negative factors, the expert mentioned a labor shortage estimated at 15-20% and high inflation, which reached 15.9% in May. Additionally, there is a significant trade deficit. On the positive side, there is active development in the defense industry.
“By the end of the year, the expert predicts a decrease in the inflation rate to a single-digit figure of 9.3%. According to his estimates, this year Ukraine will receive $52 billion in foreign financial aid, thus ending the current year with the largest reserves in its history. Importantly, part of the loans provided to Ukraine will be repaid using frozen Russian assets, and some European loans are interest-free with repayment terms of up to 30 years.”
Forecasts for 2026: two scenarios
For 2026, Dragon Capital considers two possible economic development scenarios. Under the conservative scenario, if hostilities continue throughout the year, GDP growth will be 1.5%, inflation will be 5.3%, and the hryvnia may devalue by 10%. To cover the budget deficit, $8 billion will need to be raised, and approximately $35 billion is needed for the purchase of weapons and ammunition.
The optimistic scenario envisions the end of the active phase of hostilities by late 2025 or early 2026. In this case, GDP will grow by 5%, inflation will be up to 7.5%, and up to 1 million citizens will return to Ukraine.
Moreover, Tomas Fiala is confident that in December, Ukraine will be able to conclude a new four-year cooperation program with the International Monetary Fund. This agreement is expected to be based on a conservative forecast, according to which active warfare may continue until 2027.