Ukraine's Economy Shrinks by -30.4% Last Year... "Worst Since Soviet Independence"

Smoke rises over Kyiv, the capital of Ukraine, due to a Russian attack. [Image source=Yonhap News]

[Asia Economy Reporter Song Seung-seop] Ukraine's economy, which has been at war with Russia for over 10 months, has contracted by more than 30%.

On the 5th, Yuliia Svyrydenko, Ukraine's Minister of Economy, announced that last year's gross domestic product (GDP) decreased by 30.4% compared to the previous year. This is the largest decline in over 30 years since Ukraine gained independence from the Soviet Union in 1991. Before the war began, Ukraine's GDP growth rate was 3.4%.

Minister Svyrydenko explained, "When Russia launched its invasion in February, most experts expected a decline of over 40-50%, so this is better than anticipated," adding, "The efforts of the Ukrainian military, cooperation between the government and businesses, the resilient spirit of the people, rapid reconstruction of damaged infrastructure, and systematic financial support from the international community have enabled Ukraine to maintain its economic situation and continue moving toward victory."

Meanwhile, in September last year, the Ukrainian government, the World Bank (WB), and the European Union (EU) Commission jointly released a report estimating the cost of Ukraine's reconstruction and recovery at $349 billion (approximately 443 trillion won). As the war has prolonged, the actual reconstruction costs are expected to be even higher.