Ukraine economy improves in April as Russia’s outlook worsens, prime minister says
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Ukraine's economy improved in April, driven partly by the defense industry, softening what had been expected to be a sharper slowdown in early 2026 after the country's toughest winter of the full-scale invasion, the prime minister said.
Overall output contracted by 0.2% in the first four months of 2026 — but the figure is a significantly better result than what was earlier expected, Yuliia Svyrydenko said in a Telegram post.
"Following a difficult February, the recovery began as early as March," Svyrydenko said in the post.
Russia targeted Ukraine's civilian energy infrastructure with thousands of drones and hundreds of missiles last winter as temperatures regularly plummeted to minus 20 degrees Celsius, causing a humanitarian catastrophe and reducing economic activity.
Domestic trade, manufacturing, the food industry, and particularly the defense industry are driving growth, Svyrydenko said, with some rising more than 10%.
"The GDP decline in the first months was not a surprise," Mykhaylo Demkiv, financial analyst at Ukrainian investment fund ICU, told the Kyiv Independent.
"But the prospects for 2026 are uncertain, and very weak growth is expected," Demkiv said.
Ukraine's central bank cut the country's growth outlook by half a percentage point to 1.3% in April, as the war in the Middle East hit Ukraine's fragile economy.
ICU is forecasting even lower growth of 0.8% in 2026, lower than the central bank and contrasting with more optimistic forecasts from international financial institutions.
The International Monetary Fund forecasts 2% growth in Ukraine in 2026, and the World Bank forecasts 1.2%, according to Svyrydenko.
Svyrydenko contrasted it with a bleak outlook in Russia, which last week slashed its expected growth in 2026 to 0.4%, compared to an earlier estimate of 1.3%, despite a massive increase in energy prices due to the war in Iran.
Ukrainian long-range drone strikes on Russian oil infrastructure and export terminals have dented Russia's ability to reap a windfall from the higher global oil price.
