Ukraine's GDP grew by 1.1% in the first 2 months – First Deputy Prime Minister

Ukraine's gross domestic product (GDP) increased by 1.1% in January-February 2025, said First Vice Prime Minister – Minister of Economy Yulia Svyrydenko.

“While this is a moderate increase, it remains a positive sign of economic resilience. Despite the ongoing challenges of war, inflation and infrastructure destruction, Ukraine's economy is gradually recovering and showing signs of growth,” she wrote on Tuesday on the social network X (formerly Twitter).

According to Sviridenko, several factors contributed to this growth. One of the key factors was the restoration of critical infrastructure, as significant government funds were spent on repairing damaged facilities, carrying out large-scale reconstruction and developing housing construction. In addition, increased activity in the metallurgical sector also contributed, where the production of cast iron, steel and rolled products continued to increase.

The expansion of Ukraine's defense industry also contributed to the increase in GDP. The purchase of domestic defense equipment, the expansion of production capacity, and the fulfillment of defense orders contributed to industrial and technological progress. In addition, the implementation of business recovery and development programs contributed to the growth of the manufacturing sector as a whole.

However, challenges remain. According to the statement, the main barriers to economic growth include a shortage of skilled labor, limited access to finance, damaged energy infrastructure, rising energy prices and logistical constraints.

“Ukraine’s economic recovery faces obstacles, but the signs of resilience are undeniable. The government’s focus on infrastructure development, industrial growth, and defense production has created a foundation for economic stability even in the face of war. With continued investment, strategic reforms, and international support, the path to recovery remains strong,” Svyrydenko concluded.

As reported, on February 28, the International Monetary Fund (IMF) downgraded its 2025 economic growth forecast for Ukraine, cutting it by 0.5 percentage points (pp) from its previous forecast, now expecting GDP growth in the 2-3% range. Other institutions have also revised their forecasts downwards: the European Bank for Reconstruction and Development (EBRD) lowered its 2025 forecast from 4.7% to 3.5%, the World Bank revised its estimate from 6.5% to 2%, and the National Bank of Ukraine (NBU) lowered its forecast from 4.1% to 3.6%. Meanwhile, Ukraine's state budget for 2025 is based on a projected GDP growth of 2.7%.