Energy terrorism continues: the National Bank told what it will mean for Ukraine

For more than four weeks, Ukraine has not felt a shortage of electricity, and the generators that the business purchased for the sake of uninterrupted work was covered with dust. But on the night of March 8 to March 9, the enemy resumed attempts to deprive the country of stable energy - rockets and Shahd rockets and Iranian drones flew to the cities.

The NBU says that the negative impact of the Armed Forces of the Russian Federation on energy infrastructure will be felt both in 2023 and in the next 2024. Without the influence of Russian energy terrorism, the situation in the economy of Ukraine in the spring of 2023 would be noticeably better.

As reported at the National Bank of Ukraine in response to a request of focus, the restoration of economic activity, which began in Ukraine in May 2022, would be highly probability in the fourth quarter, if it were not for Russian terrorist attacks against energy infrastructure.

The National Bank noted that interruptions and restrictions on electricity supplies have affected all activities, but a significant part of the business has been able to adapt to changing work schedules and using generators. Particularly flexible was retail trade and part of the service sector.

But given the peculiarities of production processes, according to the NBU estimates, representatives of the following industries were particularly affected: instead, the NBU claims that the electricity deficit had a less negative impact on agricultural enterprises, except for greenhouse farms and livestock. The NBU noted that these assumptions remain evaluative and are based, in particular, on the results of the survey of the enterprises given in the inflationary report for January 2023.

Because the State Statistics Committee has not yet published statistical indicators for the fourth quarter of 2022, based on which it would be possible to better evaluate the actual impact of the electricity deficit on the economy. According to preliminary estimates in 2022, the economy decreased by more than 30%. Russian energy terrorism also affected the state budget.

At the end of 2022 and in early 2023, the NBU estimates decreased the receipt of the following taxes: the National Bank specifies that the amount of income tax income was influenced damaged energy objects. That is, these unpredictable costs "ate" business profits and, accordingly, fell taxes paid from taxes.

In response to a similar deterioration of the situation in the economy in the NBU, the following two scenarios of events were modeled: fortunately, while it is about the implementation of the basic scenario, according to which the current NBU macro -prognosis for 2023 provides for GDP increase by 0. 3% and slowing inflation to 18 , 7%.

Compared to the previous October prognosis, the indicators had to worsen, since the electricity deficiency leads to a decrease in production volumes and a decrease in consumer demand. As part of the basic scenario, the negative contribution of electricity deficiency to the growth rate of real GDP in 2023 is estimated at 1. 9 percentage points (VP), and in 2024 - another 0. 6 century. If a negative scenario was realized, the losses would be more significant - 3. 6 in. n. and 1. 5 in. n.

In 2023 and 2024, respectively. According to NBU estimates through Russian energy terrorism, the dynamics of GDP of Ukraine in 2023 will slow down 1. 9 percentage points "Electricity deficit also leads to foreign trade losses, primarily due to an increase in the import of petroleum products and energy goods. $ 2 billion and another $ 0. 5 billion in 2024, ”the NBU continues. At the same time, if a negative scenario was implemented, it would be a minus of $ 4 billion this year and $ 1.

2 billion in the next year. In addition, in the National Bank due to the increase in business costs, in particular on the purchase of autonomous power supplies and fuel for it, the inflationary impact of energy terror in the II-III quarters of 2023 is estimated in additional 3 in. However, the situation in energy in 2023 was better than expected. Since the beginning of February, the electricity shortage began to decline and was completely overcome in the second half of February - early March.

This was facilitated by the following factors: given that the electricity deficiency in the first quarter and by the end of 2023 may be less than previous estimates in the absence of further destruction in the NBU express their readiness to improve the prognosis for the dynamics of real GDP in 2023. The National Bank should be prepared during the next forecast cycle and present at a press briefing on monetary issues on April 27, 2023.