Ukraine’s economy grew by 5.3% last year despite the ongoing Russian missile and drone attacks, as the country regained control of the Black Sea export corridor and enjoyed a bumper crop. Despite this resilience, the International Monetary Fund (IMF) warned of challenges in 2024. The IMF expects growth to soften to 3%-4% due to uncertainty surrounding the ongoing war and increasing supply constraints. Ukraine faces obstacles such as demands from Poland to block part of its food sales to the European Union to protect Polish farmers, delays in foreign aid and labor shortages affecting employers.
Bondholders are anxiously awaiting economic data as Ukraine seeks to overhaul its debt before a two-year moratorium expires later this year. Gross domestic product data will also determine government payments on securities tied to economic growth, known as GDP warrants. These warrants are currently trading at a high level, above 56 cents on the dollar.
Despite these challenges ahead, Ukraine’s economy has shown remarkable resilience and growth in the face of adversity. The country is working tirelessly to address these obstacles in order to continue its economic recovery. As such, it remains optimistic about its future prospects and is determined to overcome any challenges that may come its way.