Further Blackouts May Shrink Ukraine’s GDP By 39%

Ukraine’s GDP, which is seeing critically low figures amid the ongoing war, will drop even more – by 39% over the year, if systemic power outages due to Russian shelling prevail for at least a few more weeks.

That’s according to Yulia Svyridenko, First Deputy Prime Minister, Minister of Economy, who spoke in a comment to Ukrinform during her visit to Washington.

“According to our calculations, if the blackouts continue for the next few weeks, Ukraine’s GDP will decrease even more – by 39%,” the head of the Ministry of Economy said.

She emphasized that power outages affect not only households, but also businesses and companies that are forced to suspend operations.

The Ukrainian economy has already suffered as a result of the war due to the occupation of certain territories of Ukraine, where metallurgical and other large enterprises are located, as well as the destruction of infrastructure, outflow of labor and capital, and many other factors. In addition, supply chains have been seriously disrupted.

“If more problems with destroyed power networks are added to the list, our GDP will fall even more,” noted Svyridenko.

To solve the problem or at least mitigate its implications, the minister believes it is necessary, first of all, to quickly restore damaged infrastructure. In addition, the transition of businesses to alternative power sources can play its role. As an example, she cited a large number of gas stations that use power generators during blackouts.

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As reported by Ukrinform, according to the latest IMF estimates, published late October, Ukraine’s GDP was estimated to drop 35% at the end of this year.