World Bank forecasts Ukrainian GDP decline for 12% in 2015
Experts explain the decline is caused by damage for industry because of the conflict in the East
Real GDP of Ukraine will reduce for 12% in 2015, stated in the materials of the World Bank. Figures were prepared before the loan of $500 million.
"We expect real GDP to decline for 12% in 2015, with faster temps of recession in the first half of the year and the subsequent slowdown in the second half of the year due to the low statistical base (taking into consideration the failure of the second half of 2014)," it is said herein.
In April, the World Bank has downgraded its forecast of Ukrainian economy's fall in 2015 to 7.5%, comparing to 2.3% in January, and to 6.8% in 2014.
Now experts anticipate for significant decline in metallurgy and mining, mostly affected by the conflict. "Retail sales are likely to decline further due to the significant decrease in real disposable income, caused by a sharp increase in tariffs, currency depreciation, and decrease of real wages. The problems in the banking sector are expected to persist," it is noted in the materials.
The World Bank predicts that in the second half ot he year rates of decline might slow down. "The economic recovery is likely to come later than it was previously expected. Unless the situation in the East escalates, returning to positive but still lower growth is expected, starting from 2016. Exports, investment, and privatization should be the driving forces," the document says.
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