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Ukraine: Fall in industrial production moderates in July

August 27, 2015

In July, industrial production fell 13.4% over the same month last year, according to data released by the State Statistics Service of Ukraine. The result was an improvement from June’s 18.1% decrease and marked the most moderate contraction in one year. However, July’s result still marked the 19th consecutive month of decline amid the geopolitical tensions in the country. Significant contractions were recorded in manufacturing, mining and quarrying, as well as in electricity, steam, gas and air conditioning.

The ongoing crisis between the Ukrainian government and pro-Russian separatist groups continues to have a large negative impact on industry, which is already weak. Steep contractions were recorded in the eastern regions of Luhansk and Donetsk, Ukraine’s industrial heartland and where the conflict has been centered. Industrial output in July plummeted 59.0% annually in Luhansk and 46.0% in Donetsk.

On a monthly basis, industrial production rose a seasonally-adjusted 3.4% in July, which was above June’s 1.5% rise. The annual average variation in industrial output continued to decline, decreasing from minus 18.4% in June to minus 18.6% in July.

FocusEconomics Consensus Forecast participants’ project that industrial output will plummet 13.6% in 2015, which is down 1.2 percentage points from last month’s forecast. For 2016, panelists expect industrial production to rise 3.3%.


Author: Angela Bouzanis, Senior Economist

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Ukraine Industry July 2015

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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