Russian invasion to nearly halve size of Ukraine economy 

Russia’s brutal invasion of Ukraine is set to deal the country a seismic economic shock alongside triggering a humanitarian crisis, reveals official forecasts published today.

The Ukrainian economy will shrink to nearly half the size it was last year as a result of the Kremlin’s war, with GDP dropping just over 45 per cent, according to calculations by the World Bank.

Moscow’s relentless shelling of Ukraine’s largest cities has wiped out crucial infrastructure which will hamstring the country’s ability to produce goods and services in the future.

Output has been hit by businesses from Kyiv to Mariupol being shuttered over fears workers could be hit by Russian bombing.

The economic suffering comes on top of Russian President Vladimir Putin overseeing brutal military tactics that have included alleged war crimes and causing the biggest movement of refugees in Europe since the second world war.

Anna Bjerde, World Bank Vice President for the Europe and Central Asia region, said: “The magnitude of the humanitarian crisis unleashed by the war is staggering. The Russian invasion is delivering a massive blow to Ukraine’s economy and it has inflicted enormous damage to infrastructure.”

The spillover economic effects of the war is intensifying existing concerns that the global economy was headed for a period of slower growth caused by historic high inflation.

Energy prices have soared since the Kremlin sent troops into Ukraine, adding to the cost of living squeeze that is hitting the finances of consumers in most rich nations.

“The war has added to mounting concerns of a sharp global slowdown, surging inflation and debt, and a spike in poverty levels,” the World Bank said.

“The economic impact has reverberated through multiple channels, including commodity and financial markets, trade and migration links and adverse impact on confidence,” it added.

UK inflation is already running at a 30-year high of 6.2 per cent, but is expected to trend much higher and peak at around 10 per cent.

Fresh inflation figures released on Wednesday are expected to come in at 6.7 per cent.

Most economists expect UK economic growth to come in much lower than first thought at the start of the year.

The period of sluggish growth has already started, with new data released by the Office for National Statistics released today showing the economy expanded just 0.1 per cent in February.