The National Bank of Ukraine (NBU) says that investment has become a major driving force of economic growth in the second quarter of this year, being propped up by improved business expectations.
Real GDP grew by 1.4% in Q2, 2016 year-over-year, and it increased by 0.6% as compared to Q1, 2016 (excluding seasonal factors), the regulator said in a commentary published on its website.
At this, the NBU said the real GDP growth was slightly lower than a previously published estimate of 1.6%.
”It can be attributed to the impact of challenges related to transportation in the country`s east at the end of the quarter. They contributed to the slowdown of industrial activity, particularly, in the mining and metallurgical sectors, and hampered freight transport,” the report reads.
In addition, the NBU notes a slow recovery of the service sector, while the agricultural sector has demonstrated growth due to an early start of harvesting along with high yields. Positive growth dynamics were also recorded in construction and trade, reflecting the recovery of domestic demand, which was in line with the expectations.
According to the NBU, the economic activity in Q3, 2016 was influenced by multidirectional factors. On the one hand, transport complications in the east of the country prevented some mining and metallurgical companies from loading capacities in line with demand.
Further, Ukraine has seen another, tougher transit restrictions imposed by the Russian Federation since the beginning of the quarter. All together, it has affected the industrial production as well as transport and trade.
On the other hand, the results of the harvesting campaign show high crop yields, based on preliminary forecasts, and as a result, better crop production.
The regulator noted that despite all the headwinds, business expectations continued improving in Q3, which is believed to have a favorable impact on further development of investment activity.
As UNIAN reported earlier, Ukraine`s gross domestic product in Q2, 2016 increased by 1.4% year-over-year, which is 0.1 percentage points above a preliminary estimate of 1.3%, published on August 15, according to the State Statistics Service of Ukraine.
Nominal GDP in Q2 was UAH 531.8 billion, or UAH 12,453 per capita.