Ukraine's economy ministry cuts 2026 GDP forecast again: down 1–1.5 points from June's 1.6%

Another revision

Ukraine’s Ministry of Economy, Environment and Agriculture is again revising its 2026 GDP growth forecast downward. Minister Oleksandr Kravchenko said so on 26 October at the 12th Kyiv International Economic Forum, Ukrinform and RBC-Ukraine report.

“At the start of the year the GDP growth forecast for 2026 was 2.4%. In June the ministry revised it to 1.6% for 2026 and 1.3% for 2027. We are now revising the forecast again. There is no final figure yet, but we already see minus 1–1.5 percentage points compared with our June forecast,” Kravchenko said.

Simple arithmetic puts growth at roughly 0.1–0.6%. According to RBC-Ukraine, the minister still hopes the economy will stay “in positive territory” this year, but acknowledged “significant pressure and a significant reduction of the forecast for both 2026 and 2027”.

Why the forecast is falling

Kravchenko named three main reasons:

• the blockade of seaports, through which Black Sea exports of agricultural and metallurgical products used to flow;
• intensified Russian strikes;
• to some extent, capital budget spending postponed to the end of the year.

According to the minister, damage from strikes has already reached about USD 8 billion and could hit USD 10 billion by year-end. While most losses in the first half were in the energy sector, in the second half “absolutely all sectors of the economy” have been affected.

“We need reserves and a set of tools to support business. This is also about systemic risks for the economy and our budget revenues,” Kravchenko said.

Budget shortfall

As Ukrinform reported, in the first nine months of 2026 the state budget received UAH 50 billion less than planned, including UAH 32 billion in August and September alone.

Other forecasts

Other institutions’ estimates are also deteriorating. As NV recalls, the State Statistics Service revised second-quarter growth from 0.6% to 0.4%, and real GDP shrank by 0.6% year on year in the first quarter. The National Bank cut its growth estimate to 1.1–1.2% from 1.8% in September. According to RBC-Ukraine, the World Bank kept its forecast at 1.2% in October, while the IMF lowered its estimate from 1–1.6% to 1%.

The most pessimistic scenario came from Dragon Capital chief economist Olena Bilan, who allowed for GDP falling 0.5% compared with 2025. Kravchenko himself had earlier mentioned a likely scenario of growth of about 0.5%. Because metallurgical plants halted, real GDP fell 2.4% year on year in September, RBC-Ukraine reports.

The European Bank for Reconstruction and Development had already warned on 2 October of the risk of a further decline in Ukraine’s GDP. The ministry’s signal therefore did not come as a surprise: most analysts have been lowering expectations for months, citing security, logistics and energy as the main factors.

What it means

Slower growth means lower tax revenue, harder budget execution and greater reliance on international financial aid. The 2026 state budget was based on 2.4% growth when it was adopted, so the gap between plan and reality is already significant. The ministry has yet to publish the final figure of its new forecast.