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World Bank improves forecast for growth of Ukrainian economy in 2023 to 3.3%
07.10.2022 11:35 "Agro Perspectiva" (Kyiv) —
The World Bank has raised its forecast for the growth of Ukraine’s gross domestic product in 2023 from 2.1% to 3.3%, according to the Economic Update published on Tuesday. According to the report, the assessment of the economy this year has also been improved: if in June the World Bank expected a fall of 45.1% this year, now it is 35%. In addition, the report gives a forecast of GDP growth for 2024 — 4.1%. Growth is expected to resume in 2023 but remain weak, with reconstruction efforts gathering momentum toward the end of the forecast period. The World Bank expects that the repercussions of the war are expected to reverberate beyond the short term, with economic activity scarred by the destruction of productive capacity, damage to arable land, and reduced labor supply — especially if refugees do not return, which becomes increasingly likely as the war becomes protracted and they establish their lives in host countries. Based on the global poverty line of $6.85 (per person per day, in 2017 PPP), poverty in Ukraine is to increase from 5.5% in 2021 to 25% in 2022, with high downside risks if the war and energy security situations worsen. Additionally, learning losses stemming from the pandemic are expected to be amplified by the war given the destruction of schools and disruption to schooling. For Russia this year, the World Bank also improved the decline estimate from 8.9% to 4.5%, but worsened it from 2% to 3.6% next year, expecting a slight increase of 1.6% in 2024.
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