Ukraine’s GDP Sets a Record for 2021, With External Borrowing Lower and +45% Increase in the Sales of Industrial Goods and Services. Ukraine’s gross domestic product (GDP) for 2021 grew to a record USD 200 billion. Its GDP expanded 5.9% (year on year) for the fourth quarter of 2021, making this the third quarter in a row of recovery following the 2020 pandemic economic contraction. Ukraine also reduced its foreign borrowing in 2021 to UAH 208 billion, approximately USD 7.35 million.
Ukraine Repurchases 10% of Its September 2022 Eurobonds and Redeems 5.7% of Its GDP Warrants Ukraine’s Ministry of Finance (MOF) repurchased 10% of Eurobonds maturing September 2022, reducing this issuance to USD 912 million outstanding. The MOF has issued USD 2 billion in Ukrainian Eurobonds maturing in 2033, while retiring these higher interest rate Eurobonds with shorter maturities.
Ukraine has, in addition, further redeemed 5.7% of its outstanding GDP warrants. Payments on these warrants are made based on the extent to which Ukraine’s GDP exceeds 3%, so for 2021 based on a GDP of approximately 3.3%, Ukraine will be obliged to pay up to UAH 2.4 billion (approximately USD 85 million). The price of the GDP warrants fell in January 2022 to 67% of their face value and were thus redeemed at a bargain price. The MOF has, as of today, redeemed about 20% of the GDP warrants. After the most recent MOF repurchases, the GDP warrants have recovered to 77% of their face value.