Ukraine's GDP shrinks 5.1 percent, beating expectations

A woman walks near a shop and a pile of sandbags in the centre of Donetsk, eatern Ukraine, on October 26, 2014 (AFP Photo/Dominique Faget)

Kiev (AFP) - Ukraine said its economy shrank by 5.1 percent on a 12-month basis in the third quarter, less than expected and signalling a pause in the war-torn country's accelerating economic decline.

The state statistics committee said that seasonally adjusted gross domestic product also shrank by 2.1 percent between July and September compared to the previous three months of the year.

The government had warned earlier that this year the economy could shrink by nine percent because the separatist uprising that has gripped Ukraine's industrial east has effectively shut down industries responsible for nearly a quarter of the country's industrial output.

Economy Minister Oleksandr Shalapak said this month that Ukraine's GDP reading for the third quarter may come in above expectations because of a relatively strong performance in September.

Economists attributed the September performance to a bad harvest that hurt growth in the same month last year.

Ukraine's economy recorded no growth last year and contracted by 0.2 percent in 2012.

It shrank by 5.2 percent in 2011 and has recoded almost no growth in real terms in the past 20 years.