Since the Russian invasion in February of last
year, Ukraine has been fighting hard for both its territories and its economy.
Despite severe damage to the infrastructure and ecological disasters, like the
recent destruction of the Kharkiv water dam, Ukraine has shown surprising
growth in GDP and still manages to maintain its grain exports.
In this post, we will discuss the current state
of Ukraine’s economy and the prospects of Ukrainian exports to the world in view of the Black
Sea Grain Deal coming to an end.
In 2022, Ukraine’s economic output shrank by 30% following the Russian invasion. In the first quarter of 2023, Ukraine’s GDP fell 10.5% compared to last year, but the fall was less than expected. The country’s economy has shown extraordinary resilience in the face of war, with inflation going down and the Ukrainian currency stabilizing.
One of the reasons Ukraine’s economy has not
collapsed yet is the support packages the country has received from the US, the
EU, and the International Monetary Fund. For example, in March, the IMF signed
a $15.6 billion loan over four years. The initial $900 million should be
released later this year after approval from the Fund’s executive board.
Ukraine’s agricultural exports are also keeping
the country afloat. Before the war, Ukraine was one of the top exporters of
wheat, corn, barley, and sunflower oil. Thanks to the Black Sea Deal, Ukrainian
grain has been flowing continuously to the global market, keeping prices at
However, the agreement seems to be coming to an
end in July, as Russians have repeatedly proclaimed their dissatisfaction with
the deal’s outcome. The looming cancellation is once again putting global grain
markets at risk.
Ukraine is working on some alternative
strategies to keep its exports going, but before we look into what’s ahead for
the country’s grain trade, let’s see some stats for Ukraine’s exports in times of war.