Statistics for Everyone
Ukraine’s economy seems to have quickly recovered from its July shock. According to the State Statistics Committee, August saw the GDP grow by 5.9%. Speaking in an interview with the “Ukrainian News” television program, Ukraine’s chief statistician Oleksandr Osaulenko even forecast a further improvement in production indices. In his view, the GDP growth rate might climb to 6% by the end of the year.
It will be recalled that in July Ukraine’s GDP plummeted by 5.6% for the first time in three years. The Ministry of the Economy attributed this on an extremely low grain crop that the officials blamed on bad winter and spring weather. Notably, agricultural production volume for July dropped by 31%, which was largely due to the fact that last year most grain was harvested precisely in July, while this year’s harvest was much delayed. Meanwhile, other sectors of the economy showed stable growth in July.
It is noteworthy that the Ministry of the Economy, which is responsible for making government forecasts, less than a month ago forecast a further dip in the Ukrainian GDP in August. “August will see a further reduction in GDP, while September will see a recovery,” Economy Minister Valery Khoroshovsky said in an August 18 statement, according to “Ukrainian News.” Of course, the government can be excused for erring within the margin of tenths of a percent or even by whole percentage points. But this time around the ministry failed to forecast even the general trend of economic development, expecting a downturn instead of growth.
This prompts a sad conclusion, considering the fact that the government maps out its long-term policy and calculates the state budget for the following year based on Ministry of the Economy forecasts. What kind of quality of state regulation of the economy can be spoken of, if the government cannot tell which way the economy will be going in a month’s time? It is noteworthy that between August 18 and yesterday Ukraine’s economy did not experience any breakthroughs that could speed GDP growth.
It should be stressed for the sake of impartiality that there is another reason for the discrepancy between the ministry’s forecasts and those of the State Statistics Committee. The quality of the latter’s work has been recently questioned by many. Consider for example the July price hikes that, surprisingly, had not been reflected in inflation statistics. According to the State Statistics Committee, the general price index for July declined by 0.1%. The Ministry of the Economy attributed this incongruity to delayed price statistics from the regions and said the crisis would be reflected in the August figures. However, according to official statistics, in August prices fell by another 1.7%. To all appearances, there was no crisis in Ukraine at all, nor was there economic growth or recession. Each can choose statistics or forecasts to suit himself.
