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War set to cut Ukraine's economy by almost half - Perthshire Chamber of Commerce

War set to cut Ukraine's economy by almost half

Ukraine's economy is set to shrink by almost half this year as a result of the war, the World Bank has said.

The institution forecasts Russia's invasion will cause more economic damage across eastern Europe and parts of Asia than the coronavirus pandemic.

The conflict in Ukraine has shut half of the country's businesses and slashed exports, the World Bank said.

Anna Bjerde, the bank's vice-president, said Ukraine needed "massive financial support immediately".

The bank has sent almost $1bn of assistance to Ukraine so far and has promised a further $2bn in the coming months.

It said the closure of Black Sea shipping from Ukraine had cut off some 90% of the country's grain exports and half of its total exports.

Ukraine is the world's biggest exporter of sunflower oil and the shutdown of exports has affected global food prices.

The World Bank said the war had made economic activity impossible in large parts of the country, disrupting farming and harvest operations.

"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," said Ms Bjerde.

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