Ukraine reports that its economy, which has been severely affected by war, is starting to show signs of improvement.

Ukraine’s economy ministry has announced that in the first seven months of 2023, the country’s gross domestic product (GDP) has experienced year-on-year growth of 2.2%. This positive development comes after a tumultuous 2022 marked by Russia’s full-scale invasion of Ukraine, which resulted in a significant economic downturn. In 2022, Ukraine’s economy contracted by approximately one-third, marking the most substantial annual decline in over three decades of Ukrainian independence.

However, despite the challenging circumstances, both businesses and residents have adapted to the realities of wartime, leading to a more robust economic performance than initially anticipated. Nadiia Bigun, the deputy economy minister, highlighted that the number of Ukrainian entrepreneurs has now exceeded pre-war levels, offering some encouraging news. She stated, “We have positive news — Ukrainian business is recovering, and the number of registered entrepreneurs is growing. As of the middle of summer, we have about 2 million entrepreneurs.”

“Our focus on economic growth is paramount as it is through the tax revenues generated by businesses that we are able to fund our armed forces.”

Ukraine’s economic resilience has led the government to revise its annual projections. The central bank has raised its GDP growth forecast for 2023 to 2.9%, up from the initial target of 2%, and anticipates a further acceleration in economic growth to 3.5% in the following year.

However, Western lenders, such as the World Bank, are adopting a more cautious stance. The World Bank predicts a GDP growth rate of 0.5% for Ukraine in 2023.