Ukraine Industry January 2016

Ukraine

Ukraine: Contraction in industrial production intensifies in January

February 29, 2016

In January, industrial production fell 1.7% over the same month last year, according to data released by the State Statistics Service of Ukraine. The result was a slight deterioration from December’s 1.5% decrease, which had marked the most moderate contraction since May 2014. Moderate contractions—in the context of recent data—were recorded in manufacturing as well as in mining and quarrying. However, electricity, steam, gas and air conditioning recorded a moderate expansion.

The ongoing crisis between the Ukrainian government and pro-Russian separatist groups has had a large negative impact on industry over the past year. The conflict has been centered in the eastern regions of Luhansk and Donetsk, Ukraine’s industrial heartland, which had been plagued with steep contractions for the majority of the conflict. However, industrial production expanded significantly in Luhansk, largely due to the low base from last year, while production in Donetsk only fell moderately.

On a monthly basis, industrial production contracted a seasonally-adjusted 18.6% in January, which contrasted December’s 1.2% increase. The annual average variation in industrial output in January improved for a sixth consecutive month, continuing on an upward trend, rising from minus 12.7% to minus 11.2%.

FocusEconomics Consensus Forecast participants’ project that industrial output will grow 2.7% in 2016, which is down 0.3 percentage points from last month’s forecast. For 2017, panelists expect industrial production to rise 4.2%.


Author: Angela Bouzanis, Senior Economist

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Ukraine Industry January 2016

Note: Year-on-year and annual average variation of industrial production in %.
Source: State Statistics Service of Ukraine and FocusEconomics calculations.


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