May 21, 2024

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To meet with Austrian President Vladimir Putin in Moscow on Monday;  The Ukrainian economy is collapsing

To meet with Austrian President Vladimir Putin in Moscow on Monday; The Ukrainian economy is collapsing

The World Bank predicts major economic shocks in Ukraine and Eastern Europe in 2022

The World Bank released poor economic forecasts for Ukraine on Sunday evening and warned that a more gloomy situation could arise if the conflict escalates. According to the latest estimates by the Washington Institute, by 2022, Ukraine’s GDP (GDP) will shrink by 45.1% and Russia’s GDP by 11.2%.

In Ukraine, this is 10% to 35% of what the International Monetary Fund (IMF) forecast a month ago, or 20%, much higher than the 20% announced by the European Restructuring and Development Bank (EBRD) on March 31. Government tax revenues have shrunk, businesses have closed or are only partially functioning, and the freight trade has been severely affected. Grain exports have become impossible “Large areas of the country due to severe damage to infrastructure”Anna Bizarde, vice president of the World Bank in charge of the region, underlined.

Sharp increase in poverty

The increase in poverty is also worrying. According to the World Bank, the population living at $ 5.50 a day is expected to grow from 1.8% to 19.8% by 2021.

“The results of our analysis are very harshAnna Fijarde underlined. This is the second major shock to hit the regional economy in two years, and it comes at a very dangerous time as many economies are still struggling to recover from the epidemic.She also mentioned.

The whole region suffered the economic consequences of this war. The bank expects GDP to shrink by 4.1% this year for all developing and developing countries in Europe and Central Asia, while it expects 3% growth before the war. This is far worse than the epidemic triggered by 2020 (.1.9%). Eastern Europe alone should see a 30.7% decline in its GDP, against the 1.4% growth expected before the invasion.

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read more: In Ukraine, an economy in the service of war