UK reveals data on Ukraine, Russia's real economic growth

Ukraine's real GDP growth in 2024 is expected to reach 3%, while Russia's is forecasted at 3.6%, according to data from the UK Ministry of Defense.

This GDP growth for Ukraine continues the recovery trend following the onset of the full-scale war in 2022, during which the economy contracted by approximately 29%. In 2023, Ukraine experienced real economic growth of 5%.

The International Monetary Fund (IMF) predicts that Ukraine's average annual inflation will be around 5.8% in 2024, a significant decline from its peak of approximately 20% in 2022. Defense spending is anticipated to account for about 60% of Ukraine's state expenditures in 2025.

Meanwhile, real economic growth in Russia is projected to increase by approximately 3.6% in 2024, according to UK intelligence. This growth is likely driven by government spending, particularly on the defense and military-industrial sectors. However, Russia's GDP growth is expected to slow in 2025 due to inflationary pressures, labor shortages, and international sanctions.

Russia's defense expenditures are projected to rise further in 2025, constituting 32% of total budget spending. In contrast, expenditures in other areas, such as social programs, are likely to decrease.

The rise in government spending is expected to intensify inflationary pressures in the Russian economy, with the average annual inflation rate forecasted at 7.9% for 2024.