Ukraine: Revised Q4 GDP contraction slightly better than preliminary result
March 20, 2015
According to official data released by State Statistics Service Ukraine, GDP contracted 14.8% in Q4 over the same period of the previous year, which was less than the previously released estimate of a 15.2% decrease. However, the contraction still represented a notable deterioration from Q3’s revised 5.5% decrease (previously reported: -5.3% year-on-year). Ukraine has entered a downward economic spiral as a result of the military conflict and political instability in the east of the country.
The drastic deterioration was driven by a worsening of the external sector combined with still weak domestic demand. Private consumption fell 13.6% annually in Q4, which was slightly better than Q3’s 15.5% decline. Fixed investment plummeted 26.2%, which followed Q3’s 26.7% decrease. In contrast, government consumption swung from a 0.5% contraction in Q3 to a 3.5% expansion in Q4.
On the external front, exports tumbled 31.0% in the fourth quarter (Q3: -16.8% yoy) and imports plummeted 29.0% (Q3: -31.9% yoy). As a result, the net contribution of the external sector to GDP growth fell from plus 11.3 percentage points in Q3 to plus 4.9 percentage points in Q4.