Ukraine’s Real GDP Grew By 3.8% in 2024

By the end of 2024, Ukraine demonstrated moderate economic growth of 3.8%, according to preliminary estimates by the Institute for Economic Research and Policy Consulting (IER).

The IER projects real GDP growth of approximately 3% in 2025, the institute said in a press release.

The growth of metallurgical production and iron ore extraction was facilitated by access to the Ukrainian maritime corridor. Agricultural companies also continued exporting their products both by sea and rail. Improved logistics compared to 2023 contributed to a modest increase in goods exports, the IER wrote.

Preliminary government data shows that exports grew by 15% in 2024, while imports rose by 8%. However, imports remained significantly higher than exports due to the ongoing consequences of the war with Russia, the press service wrote.

The development of the manufacturing and textiles industry was driven by state demand for weapons and equipment for defense needs.

Trade recovered thanks to a sharp increase in wages stimulated by a labor shortage, as well as adjustment of wages to inflation, partially funded by international aid.

Despite higher inflation (11% year-over-year in November) and the depreciation of the Hryvnia from Hr. 38 to Hr. 42 per $1, Ukraine’s central bank maintained macroeconomic stability and increased international reserves to over $43 billion.

At the same time, uncertainty remained high throughout the year, somewhat limiting corporate investments. According to IER surveys, the main obstacles to business operations in 2024 were working under dangerous conditions, labor shortages, and problems with electricity access.

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Russian attacks on energy infrastructure caused electricity shortages, affecting both businesses and households. However, this prompted the development of distributed energy generation networks, with 835 MW of such facilities connected during the year, the IER wrote.

Government and international donor efforts to insure against wartime risks and provide guarantees are expected to yield better results in 2025, according to IER experts. That year, more investment financing will also arrive as part of the second component of the Ukraine Facility.