S&P Global Ratings predicts the hryvnia, Ukraine’s national currency, will have weakened against the U.S. dollar to UAH 28.6 by the end of 2019. The hryvnia is expected to drop to UAH 29.5 per dollar in 2020, to UAH 30 in 2021, and to UAH 30.5 in 2022, according to the agency’s press release.
Ukraine’s real GDP may grow by 2.5% in the current year, by 2.8% in 2020, and by 3% in 2021 and 2022 (each), S&P said.
According to the agency’s forecasts, the inflation rate will be 8.1% in 2019, 7.5% in 2020, 7% in 2021, and 6% in 2022.
S&P says GDP per capita in Ukraine is the third lowest among the countries of Europe and the CIS, after Tajikistan and Uzbekistan. Low income explains significant labor migration from the country. The number of Ukrainians working in Poland in 2018 increased by over 40%, to 1.7 million people.
According to S&P, Ukraine will need more investment to accelerate its economic growth. The investment last year accounted for a mere 19% of GDP, with a pre-crisis rate of 30% in 2007. Another factor affecting the country’s economic growth is weak lending to the banking sector. Thus, according to S&P, from 2014 to 2018, real growth in private sector lending declined by almost 65%. (UNIAN/Business World Magazine)
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