Dragon Capital forecasts GDP decline in both 2026 and 2027
Dragon Capital has sharply downgraded its economic outlook for Ukraine, forecasting real GDP to contract by 0.5% in 2026 and by another 1.0% in 2027 as intensified Russian attacks increasingly damage industry, logistics and energy infrastructure.
Dragon Capital has revised its economic outlook for Ukraine, predicting a contraction in real GDP by 0.5% in 2026 and another 1.0% in 2027 due to intensified Russian attacks damaging industry, logistics and energy infrastructure. Prior to the escalation, the investment firm had anticipated 1.5% growth this year and 0.5% growth next year.
Russian attacks since July 2026 have caused significant economic losses, with cargo traffic through Black Sea ports virtually halted, steel plants forced to suspend production, and targeted attacks damaging industrial facilities and civilian infrastructure. Dragon Capital now expects the blockade of Ukraine's Black Sea ports to reduce real GDP by 2.2%, even with some agricultural exports redirected to alternative routes.
If maritime grain exports resume before the spring planting season, the GDP loss could fall by 1.5 percentage points to about 0.7%. Attacks on Ukraine's energy infrastructure may also have a greater economic impact than previously anticipated. Dragon Capital estimates Ukraine's foreign trade deficit to reach $71 billion in 2026, or around 31% of GDP, a record high.
The deficit is expected to remain close to record levels in 2027. Inflation is also expected to increase, with a 1 percentage point rise to 10% in 2026 and another 2 percentage points to 8% in 2027.
Written by urgent.news from New Voice of Ukraine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
