Ukraine expects GDP to fall by 40% in 2022
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Industries where remote work is impossible have suffered the most.
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The estimated damage from the war in Ukraine amounts to $564 billion. (Anadolu Agency)
According to Kommersant - a Russian newspaper dedicated to politics and business - Ukraine's gross domestic product (GDP) in the first quarter of this year is bound to decline by 16% year on year, according to the Deputy Minister of Economy, Denys Kudin.
According to the ministry's prediction, by the end of 2022, the fall of the GDP may reach 40%, according to a press release on their website.
Kudin contended that industries, where remote work is impossible, have suffered the most; according to him, those are mostly air and sea transportation, as well as services, where business is conducted directly with consumers.
He added that over the past 10 days, Ukraine's economy as a whole began to revive: business is back, and farmers have begun harvesting.
In parallel, the European Bank for Reconstruction and Development (EBRD) predicted a decline in Ukraine's GDP in 2022 by 20%. The EBRD also expects a decline in economic growth in Russia by 10%, believing that this comes as a result of the war in Ukraine.
According to the Ministry of Economy of Ukraine, the estimated damage from the war in Ukraine amounts to $564 billion.
Ukraine losses against Russia could amount to $500bln: Kiev
Losses due to the Russian special military operation in Ukraine could amount to some $500 billion, Ukrainian Finance Minister Serhii Marchenko said in Mid-March.
He asserted that the negative consequences of the Ukraine crisis would be devastating for the country.
"Tens of areas where hostilities are taking place account for half of the GDP. The most important sections are Kharkov, Kiev, and Mariupol, which made a very significant contribution to the GDP," the Ukrainian minister told Forbes.
"Many supply chains are completely broken, many enterprises are physically destroyed, some are unable to work in war mode, many workers simply left," he added, highlighting the toll Russia's special military operation took on Ukraine.
According to Marchenko, the ministry of economy believed that the losses would cost Ukraine between a third to a half of its GDP. However, he also highlighted other estimates, which suggested that the losses would amount to a whopping $500 billion.
"It will be possible to calculate exactly only after the war," Marchenko added in an interview with Forbes.
On March 10, Volodymyr Zelensky's economic adviser, Oleksii Ustenko, estimated that assets worth $100 billion had been destroyed in Ukraine.
Russia had launched a special military operation for several reasons, such as NATO's eastward expansion, the Ukrainian shelling of Donbass, and the killing of the people of the Donetsk People's Republic and Lugansk People's Republic, in addition to Moscow wanting to "denazify" and demilitarize Ukraine.
