Breaking News

Tweet TWEET

Ukraine’s GDP Grew at Fastest Pace Since 2007, Azarov Says

Ukraine’s gross domestic product expanded at the fastest pace since 2007, spurred by a good harvest and increased exports, Prime Minister Mykola Azarov said.

The economy grew “almost” 5 percent, Azarov told a weekly Cabinet meeting today in the capital, Kiev. That compares with a 4.2 percent rise in 2010 and a 3.9 percent forecast by the government for 2012. The European Union’s debt crisis is a “risk” for Ukraine’s economy this year, he said.

Ukraine’s state debt declined to 27.4 percent of GDP last year, compared with about 30 percent in 2010, Azarov said. The government cut the budget deficit to 1.7 percent of GDP in 2011, he said without giving any details.

The former Soviet republic’s economy has picked up after an almost 15 percent decline in 2009 as foreign demand for its steel and chemicals waned. The grain harvest probably increased by about 50 percent in 2011 because of favorable weather.

Ukraine, which relies on Russia for more than 70 percent of its natural gas needs, is seeking to negotiate a discounted price to help its public finances. The 2012 budget assumes an average price of $416 per 1,000 cubic meters for the fuel from Russia.

“This year will be decisive for solving the gas issue,” Azarov said, adding that Ukraine will cut gas consumption and should use more electricity.

Ukraine also wants to reduce gas imports to 27 billion cubic meters of gas in 2012, compared with 45 billion cubic meters in the previous year.

-- With assistance from Kateryna Choursina in Kiev. Editors: Alan Crosby, Andrew Langley

To contact the reporter on this story: Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.