Photo :webshot.
March 15, 2022
Andrew
While the future is uncertain, the economic consequences have already been severe, with over 2 million people fleeing the country and large-scale devastation of Ukraine's major infrastructure. The International Monetary Fund (IMF) estimates that the loss of life, damage to essential infrastructure, trade disruption, and refugee outflow will result in a minimum 10% drop in GDP in 2021. The IMF has warned that if Russia's invasion turns into a protracted conflict, Ukraine's war-torn economy could contract by 25% to 35% by 2022.
On March 9, the IMF announced a US$1.4 billion emergency assistance package to assist Ukraine in dealing with the financial consequences of Russia's invasion. In emergency financing support to Ukraine, the IMF Executive Board approved a US$1.4 billion (SDR 1,005.9 million) disbursement under the Rapid Finance Instrument (RFI) to help address urgent financing needs and reduce the economic impact of the war.
According to the IMF, data on real GDP contraction during wars (Iraq, Lebanon, Syria, and Yemen) suggests that future annual output contractions could be significantly larger, in the range of 25-35 percent. In these extremely difficult circumstances, the IMF expresses its heartfelt condolences to the Ukrainian people and pledges to continue working closely with Ukrainian authorities.