Ministry of Economy: GDP grew by 3.5% in January due to expanded logistics capacity and rising investment demand

In the first month of 2024, the Ukrainian economy continued its recovery trend. According to preliminary data, the Ministry of Economy estimates GDP growth in January at 3.5% [±1%] compared to January 2023.

“The key factors supporting the positive economic dynamics at the beginning of the year were the growing investment demand generated by the budget, as well as the accessibility of foreign markets for domestic producers due to the expansion of logistics capabilities.

In particular, the operation of the Ukrainian sea corridor allowed to achieve record export volumes since the beginning of the large-scale invasion of russia and to continue to increase economic activity, primarily by agricultural and metallurgical producers, metal ore mining companies and railway transport. Also, the lifting of the blockade of the Ukrainian-Polish border by Polish road carriers in the middle of the month had a positive impact on both exporters and manufacturers who are heavily dependent on imported raw materials,” explained Yuliia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine.

According to preliminary estimates, in January, the main sectors of the economy showed positive dynamics. The transport sector was supported by an increase in domestic rail traffic and cargo handling at seaports. The continued recovery in economic activity driven by export-oriented industries, namely metallurgy, metal ore mining and agro-processing, and energy, not only led to positive trends in industry but also generated demand for products from related businesses.

In turn, the construction industry is also growing due to investment demand amid continued budget funding for the restoration of damaged critical infrastructure. In January, positive recovery trends were also observed in agriculture and domestic trade.

“Positive trends in the main sectors of the economy create a further solid economic base for continued economic growth in the first quarter of 2024. The Ukrainian economy continues to adapt and acquire the characteristics of a wartime economy. The key unresolved issues remain the ongoing destruction of production facilities, the difficult situation in the labour market due to high migration, and the lack of available credit resources,” concluded Yuliia Svyrydenko.