With the progress of the Russian war of aggression, the World Bank has revised its economic forecast for Ukraine significantly downwards.
Economists predicted on Sunday that Ukraine's gross domestic product would fall by 45.1 percent this year - after expecting a drop of between 10 and 35 percent a month ago.
The economy of Russia, which is subject to international sanctions, will shrink by 11.2 percent.
"The results of our analysis are very sobering," said World Bank Vice President for Europe and Central Asia Anna Bjerde.
"Our forecasts show that the Russian invasion of Ukraine has wiped out the region's recovery from the pandemic." The "second major shock" hit the economies at a "precarious time".
The Washington-based institution assumes that the emerging and developing countries in the Europe and Central Asia region will shrink by 4.1 percent this year.
That's a drastic reversal from the 3 percent growth forecast before the war and twice as bad as the 2020 recession caused by the pandemic.
Implications for energy and grain prices
The worst affected is Ukraine.
Grain exports and other economic activities have "become impossible in large parts of the country due to severe damage to infrastructure," Bjerde explained.
This has global consequences: Because of the war, world market prices for grain and energy, where Ukraine and Russia are among the most important exporters, have shot up significantly.
The bank's forecasts assumed that the war would continue for a few more months.
In the event of a significant escalation, Ukraine's economy could collapse by 75 percent and Russia's by 20 percent.
Poverty is increasing rapidly
According to the World Bank, the war will also multiply poverty in Ukraine.
The proportion of the population living on $5.50 a day will rise to 19.8 percent this year, up from 1.8 percent in 2021, according to the World Bank.
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