Ukraine economy to shrink by 45.1% in 2022, Russia's GDP to drop by 11.2%: World Bank

As Russia- Ukraine war continues to impact global ecomy, World Bank on Sunday issued a forecast predicting ecomy of war-hit country Ukraine will collapse by 45.1% in 2022. Bank furr issued a warning stating a possibility of an even bleaker ecomic outlook, far worse than 10-35% downturn  IMF projected last month.

World Bank said that Russia and its neighboring countries are suffering consequences from ongoing Ukraine war as Putin's country is likely to see a 11.2% decline in GDP. war which began on February 24 has caused more than four million Ukrainians to flee to Poland, Romania, and Moldova, furr causing  prices of grains and energy to soar.

" results of our analysis are very sobering. Our forecasts show that Russian invasion in Ukraine has reversed region's recovery from pandemic," said Anna Bjerde, World Bank vice president for Europe and Central Asia.

She furr mentioned that regional ecomy is facing its second major shock in two years and comes at a crucial time for region, as many ecomies are still struggling to recover from  COVID pandemic. 

Washington-based institutions expect 'emerging and developing countries in Europe and Central Asia region to contract by 4.1% this year, a sharp reversal from three percent growth projected before war, and twice as b as pandemic-induced recession in 2020'.

Ukraine ecomy

Ukraine's ecomy is severely affected due to shrunken government revenues, businesses, and tre in goods that are bly disrupted. Furr, heavy dams to infrastructure have me it hard for grain exports and or ecomic activities.

bank's forecasts cautioned that Ukraine is subjected to 'significant uncertainty', assuming war would continue for a few more months. 

As per report, " region's ecomy would contract by nearly nine percent -- worse than 2008 global financial crisis - with a 20% decline for Russia and a 75% collapse for Ukraine". 

An increase in poverty in war-hit country is ar cause for concern as proportion of population living on $5.50 a day is expected to rise to 19.8% this year from just 1.8% in 2021, according to World Bank.

Despite avoiding  worst-case scenario, Eastern Europe alone is expected to see its GDP drop by 30.7% rar than grow by 1.4%, as projected before Russia's invasion of Ukraine. sanctions imposed on Russian ally Belarus for its role in war have also impacted region. 

In early March,  International Monetary Fund (IMF) discussed  ecomic impact of war in Ukraine, and possible fast-tracked financial assistance for affected countries.

It said in a statement, “While situation remains highly fluid and outlook is subject to extraordinary uncertainty, ecomic consequences are alrey very serious".

“ ongoing war and associated sanctions will also have a severe impact on global ecomy,” it warned.

(Im: AP)