In May 2025, Ukraine’s current account deficit (CAD) rose to a record $3.5 billion, marking the highest monthly figure since the onset of the full-scale war. In comparison, the total deficit for the entire year of 2021 was $3.9 billion.
This is reported by Business • Media
Increase in Imports and Decline in Transfers Affected the Balance
The primary reason for the record deficit was a significant deterioration in the trade balance. In May 2025, imports of goods increased by 20.6% year-on-year, while exports rose by only 1.4%. As a result, the deficit in external trade of goods reached $3.6 billion – 47% higher than in May of last year.
Additionally, the volume of private remittances from abroad decreased by $0.7 billion. The surplus in secondary income, including non-repayable aid, also fell, dropping to $0.7 billion in May. This is 29.2% less than last year and is the lowest figure since the beginning of the war.
Low Investment Levels and IMF Forecast
By the end of the first five months of 2025, the CAD had already reached $11.8 billion. This is nearly double the figure for the same period in 2024 and almost seven times higher than the 2023 figure. According to the updated forecast from the International Monetary Fund, the CAD may reach $34.6 billion in 2025, which would account for 16.5% of the country’s projected GDP. For comparison, this figure was 8.3% in 2024 and 5.4% in 2023.
“The CAD is manageable when it is covered by inflows of foreign direct investment (FDI), the positive effects of which primarily offset the trade balance, which we expect to reach a deficit of $46 billion this year. However, in May, the total inflow of FDI was absent. Since the beginning of the year, only $0.8 billion in FDI has come to Ukraine – 3.4 times less than in the same period last year,” noted Danilo Hetmantsev, head of the Verkhovna Rada Committee on Finance.
The lack of significant inflows of foreign direct investment, particularly in new projects, is seen by experts as a troubling signal that exacerbates Ukraine’s economic vulnerability. Specialists emphasize the need for changes in the structure of the economy and the stimulation of exports to improve the trade balance and reduce the current account deficit.