
Overview
- Real GDP fell by only 0.9% in 2020; decline very low in international comparison. In 2021, however, GDP will contract more sharply by -2.7%
- Relatively soft COVID-19 measures explain the small decline in 2020; however, the ongoing political crisis clouds the outlook for 2021 in this context
- Inflation (2020: 7.4%) rises above the target, but the National Bank has yet to react
- Significant depreciation of exchange rate (-21%) despite sale of currency reserves (Feb-21: USD 7.1 bn); import cover drops to 2.6 months
- Budget balance deteriorated significantly to -4.7% of GDP in 2020. As a result, sharp rise in debt ratio last year (50.9% of GDP)
- Current account deficit increased in 2020 (-3.3% of GDP); only slight improvement in 2021 (-2.2%)
- Foreign trade declined in 2020 due to COVID-19, the energy dispute with Russia and the low energy prices; both exports (2020: -11.9%) and imports (-17.4%) very weak