Ukraine’s Economy Ministry prepares to cut 2026 GDP growth forecast again

Why it matters

The revision signals that war-related disruption, blocked ports and worsening business conditions are reducing expected economic growth. The forecast has fallen substantially from the 2.4% rate used when the 2026 budget was approved. At the same time, shelling damage and a large shortfall in budget revenue are increasing pressure on Ukraine’s economy and public finances. The economic losses are also spreading from the energy sector to other industries.

What happened

During the Kyiv International Economic Forum, Economy and Environment Minister Oleksandr Kravchenko said the ministry was preparing to reduce its 2026 GDP growth forecast once again. The final number had not been set, but a preliminary ministry assessment indicated that it would be 1–1.5 percentage points below the June forecast of 1.6%. The ministry had already lowered the forecast from 2.4% in June, while its 2027 projection stood at 1.3%.

Kravchenko cited the blockage of Ukrainian seaports, intensified Russian shelling and the partial postponement of capital budget spending until the end of the year among the factors weighing on the outlook. He put current damage from shelling at about $8 billion and expected it to reach $10 billion by the end of 2026. Most of the losses in the first half of the year affected energy, but damage in the second half is expected to affect all sectors of the economy.

Ukraine also received 50 billion hryvnias less in planned budget revenue than expected over the first nine months of 2026. Of that shortfall, 32 billion hryvnias was recorded in August and September. State Statistics revised second-quarter GDP growth down from 0.6% to 0.4%, while first-quarter real GDP contracted by 0.6% compared with the corresponding period of 2025.

How Ukrainian sources describe it

Ukrainian coverage focuses on the Economy Ministry’s further downgrade, the effects of port blockages and shelling, the scale of damage and the resulting loss of public revenue. The reporting also emphasizes how economic losses previously concentrated in energy are spreading to other sectors. The Economy Ministry and its minister are the principal sources of the assessment.

How international sources describe it

International institutional forecasts provide context for the worsening outlook. In July, the National Bank raised its 2026 growth forecast to 1.8%, but on September 17 it lowered the range to 1.1–1.2%, citing additional industrial and retail damage from Russian shelling and weaker business expectations. The IMF reduced its forecast to 1.0–1.6% in June–July, compared with 1.8–2.5% previously, and had projected 2% in its April World Economic Outlook. On October 2, the EBRD warned of the risk of further GDP contraction in Ukraine.

Where reporting differs

The ministry’s June forecast of 1.6% growth for 2026 differs from other estimates ranging from about 0.5% to 1.8%. The ministry has also considered a possible scenario of approximately 0.5% growth, while its final downward revision remains undetermined. The available Ukrainian reporting therefore presents a range of institutional and official assessments rather than a single agreed figure.

Background

The Economy Ministry first revised its 2026 growth forecast from 2.4% to 1.6% in June. The 2.4% assumption had been used when the 2026 state budget was approved. State statistics subsequently revised second-quarter GDP growth down from 0.6% to 0.4%, while first-quarter real GDP contracted by 0.6% year over year. The ministry’s preliminary assessment suggests a further reduction of 1–1.5 percentage points, but no final figure has been announced.