Friday, August 14, 2015

Ukrainian shadow economy reaches 47% of GDP in Q1, 2015 - Economy Ministry

The level of the shadow economy in Ukraine in the first quarter of 2015 increased by 5 percentage points compared to the corresponding period in 2014, to 47% of official GDP, the Economic Development and Trade Ministry has reported on its website.

"The loss of economic entities' trust in the improvement of the economic and political situation in the near future forced them to actively use schemes for concealing income, including such as expansion of losses and non-payments," the report said.

The ministry experts added that the increase in the shadow economy was stimulated by price and devaluation shocks, the escalation of the military conflict in the east of the country and the influence of external negative processes: a further aggravation of political relations with Russia and the reduction of economic ties with the country.


The ministry noted that the last time the decline in the shadow economy in Ukraine was registered in 2011 from 38% to 34% of GDP, being followed by a year of stability, and then began to rise: in 2013 to 35%, in 2014 to 41%, which accounted for the record high since 2007.

At the same time, economic growth in 2012 slowed to 0.2%, in 2013 to zero, in 2014 the economy fell by 6.8%, while in the first quarter of 2015 by 17.2%.



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