Amid the quarantine and lower global prices, Ukraine will reduce its purchases of energy and the majority of nonessential goods. The pandemic will affect Ukrainian exports less, as demand for food products remains strong. At the same time, the decline in remittances from labor migrants will be more than offset by Ukrainians spending less on foreign travel.
The current account deficit will widen again once economic activity rebounds globally and in Ukraine. There are also several reasons for this. Next year, Ukraine is expected to see a drop in gas transit revenues, as well as pent-up demand for consumer goods from households and for investment imports from businesses.