Ukraine has upgraded its economic status to an upper-middle-income country, according to a new World Bank classification. Find out how economic growth and population decline contributed to this result

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The World Bank has reclassified Ukraine as an upper-middle-income country, publishing an updated classification for the fiscal year 2024. Ukraine's income is estimated at $5,070 per capita, which has raised its ranking in the global economy.

Read this article to find out how many Ukrainians own crypto assets.

World Bank classification

The World Bank Group categorizes the world's economies into four groups by income level: low, lower middle, upper middle, and high. Every year on July 1, the classifications are updated based on gross national income (GNI) per capita for the previous calendar year. This classification reflects the level of development of a country, using GNI per capita as an indicator of economic potential.

Reasons for Ukraine's rating upgrade

Ukraine's rating upgrade was made possible by the resumption of economic growth in 2023. Real GDP grew by 5.3% after falling by 28.8% in 2022. In addition, the population has declined, falling by more than 15% since the beginning of the russian invasion. These factors, together with rising prices for domestically produced goods and services, led to a significant increase in nominal GNI per capita by 18.5%.

Economic growth in 2023 was also driven by construction activity, which increased by 24.6%. This reflects a significant increase in investment spending by 52.9%, supporting Ukraine's efforts to recover from the devastation caused by the war.

To find out how many years you need to work to buy an apartment in Ukraine, follow the link.

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Other countries that changed their income category

In addition to Ukraine, this year Algeria, Iran and Mongolia moved to the category of countries with higher than average incomes. Bulgaria, Palau and russia ($14,250 per capita) moved from the category of upper-middle income countries to the category of high-income countries.

russia's economic activity increased due to a significant increase in military activity in 2023, as well as the recovery of trade, the financial sector and construction. This led to an increase in real (3.6%) and nominal (10.9%) GDP, and GNI per capita grew by 11.2%.

We remind you! Ukraine has a great potential in the field of artificial intelligence and several hundred companies specializing in this field have already been opened in the country. Read our previous article to find out where Ukraine ranks in Europe in terms of the number of opened AI companies and what forecasts the government gives for the growth of this sphere.

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Ihor Usyk is the Head of Legal Department at Visit Ukraine

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