Pessimistic forecast for Ukraine's economy in 2025

Bùi Đức |

Ukraine's economy is forecast to grow slower in 2025 than last year as it faces a protracted conflict and energy crisis.

Ukraine's gross domestic product (GDP) growth in 2025 is expected to be slower than in 2024, Ukraine's Deputy Economy Minister Andrii Teliupa said, Reuters reported.

Mr. Teliupa forecasts that GDP growth in 2025 will be around 2.7%. Meanwhile, in 2024, Ukraine's GDP growth will reach 3.6%. However, the fourth quarter of 2024 shows signs of decline, the Deputy Minister revealed.

Previously, analysts and economists also said that Ukraine's economy in 2025 would only grow below 3-4%.

In 2022, when the conflict with Russia broke out, Ukraine's economic and logistical activities were disrupted by prolonged fighting. That year, Ukraine's GDP fell by nearly 30%.

According to the Ukrainian Ministry of Economy, in the past two years, the Ukrainian economy has shown signs of recovery, but has not yet been able to fully recover to the pre-conflict period.

The conflict has also left Ukraine facing a manpower shortage. Tens of thousands of men have been drafted into the army and millions have fled abroad as refugees.

Also according to Reuters, Kiev is struggling with an energy crisis, having to rotate power cuts in many areas across the country while people's heating needs increase during the winter.

This is partly due to recent Russian airstrikes on Ukraine’s energy infrastructure, and the situation could get worse if Slovakian Prime Minister Robert Fico cuts off electricity to Ukraine in response to Kiev’s recent move to turn off Russian gas.

In a difficult context, the Ukrainian government has had to activate many financial support programs for businesses, creating conditions to adapt to the challenges ahead.

In addition, on January 10, the European Union (EU) also approved the first $3 billion loan for Ukraine. This amount is part of the $50 billion support package agreed by the G7 countries, to strengthen Ukraine's financial and military capabilities.

On January 16, 2025, British Prime Minister Keir Starmer signed a 100-year partnership agreement with Ukrainian President Volodymyr Zelensky in Kiev. The agreement focuses on defense cooperation, especially maritime security and drone-related technology projects, to strengthen Ukraine's security and economic recovery after the conflict.

International support helps Ukraine maintain economic activity and create a foundation for future recovery and development.

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