In 2025, real GDP grew by 1.8%. This is according to detailed GDP data from the State Statistics Service of Ukraine (SSSU). The actual pace of real GDP growth matches the NBU’s estimate published in the January 2026 Inflation Report.
On the one hand, GDP growth expectedly slowed relative to 2024 (3.2% according to revised SSSU data) due to the persistence of the difficult security situation and constant attacks by russia. On the other hand, despite the full-scale war, the economy has been recovering for the third consecutive year thanks to robust domestic demand, loose fiscal policy, considerable adaptability of businesses, and the NBU’s efforts to ensure macrofinancial stability.
Robust domestic demand remained the main driver of economic growth
Private consumption provided the largest positive contribution to real GDP growth in 2025 – around 4.7 percentage points (pp). In particular, final consumption expenditures of households rose by 7.5% yoy. Moreover, against the backdrop of a loose fiscal policy, the consumption of the general government sector grew (by 5.7% in 2025), adding 2.1 pp to GDP growth.
Higher capital expenditures from the budget, coupled with improved financial performance of enterprises, supported investment activity
The gross fixed capital formation in 2025 increased by 10.9% (adding 2 pp to GDP growth). Investments were primarily made in defense sector projects and in the processing of agricultural products.
The negative contribution of net exports to GDP growth increased
Volumes of exports shrank considerably due to low agricultural inventories, the slow pace of harvesting, and weak demand for mining and metals products. In addition, growing electricity shortages at the end of the year further limited the capabilities of exporters of certain products. Meanwhile, the growth in imports of goods and services accelerated amid further increases in purchases of machinery and mining and metals products to support defense capabilities as well as energy carriers and energy equipment to restore infrastructure. As a result, the negative contribution of net exports to GDP change rose compared to the previous year to 7.9 pp.
Economic performance was uneven across sectors
Gross value added (GVA) continued to grow in trade (up 4.2%) and a number of service sectors amid steady private consumption. Construction activity also grew at a significant pace (by 11.6%) amid housing repairs, the restoration of logistics and energy facilities, and strong demand for construction services from industrial and commercial enterprises.
Increased budget spending supported growth in the GVA of the general government and defense sectors (by 6.6%) and healthcare (5.3%). GVA growth in education accelerated significantly (to 12.7%) due to additional payments to teachers and a rise in scholarships starting in September.
During the summer months, Ukraine managed to partially restore the functioning of its energy system, which slowed the decline in electricity production and distribution in 2025 (to 1.8%). The decline in mining industry output (10.6%) was primarily caused by the loss of the Pokrovsk group. At the end of the year, the situation was exacerbated by regular air strikes and electricity shortages.
Against the backdrop of unfavorable weather conditions, which caused the harvesting campaign to lag significantly behind the last year’s, the decline in the GVA of agriculture accelerated (to 6.2%). The decline in livestock production also continued due to the worsening epizootic situation and the consequences of the war.
The drawdown of agricultural products inventories and a lower oilseed harvest led to a slowdown in the growth of the processing industry (to 2.5%).
Gradual economic recovery will continue
According to the NBU’s January forecast, the economic recovery will continue in 2026. Real GDP is expected to grow by 1.8% thanks to higher crop yields and further increases in investment in reconstruction projects and the defense sector. Ukraine’s European integration will also have an additional positive impact on investment activity.
The course of the full-scale war remains the main risk to economic development. On top of that, GDP dynamics may be significantly impacted by the materialization of risks associated with irregularity and/or insufficiency of external financing, as well as with how long it takes for the war in the Middle East to be resolved.
However, the probability of upside scenarios remains. These would primarily be driven by a potential increase in military and financial support from partners, as well as by the international community’s efforts to ensure a just and lasting peace for Ukraine.