The European Bank for Reconstruction and Development (EBRD) said Thursday that the Ukrainian economy would contract more sharply this year than it had estimated earlier.
In its newly released Regional Economic Prospects report, the bank said Ukraine’s gross domestic product (GDP) will shrink 11.5 percent in 2015, down from the 7.5-percent decrease it projected in May.
The EBRD attributed the downward revision to the sharp decline of the Ukrainian economy in the first two quarters of this year and continued domestic and regional risks, such as widening state deficit, shrinking exports and possible escalation of the situation in eastern regions, the country’s industrial heartland.
While noting that Ukrainian economy is expected to fare better next year, it has cut the projection of the country’s 2016 GDP growth to 2 percent from the previous estimates of 3 percent.
The Ukrainian government has forecasted earlier that the country’s economy will rise by 2.2 percent in 2016 after contracting by 8.9 percent this year.