Unending war clouds Ukraine's economic future

Significance

The war is severely disrupting economic activity in Ukraine as infrastructure is destroyed, populations uprooted and trade routes disrupted. Despite anticipated international support for reconstruction, devastation on this scale will have lasting effects and work cannot start in earnest yet.

Impacts

• The scale of the massive post-war reconstruction effort required will depend on the continuing generosity of external funders.
• Although the banking sector has not suffered extensive deposit outflows, the share of non-performing loans is rising.
• Closer alignment with EU standards is likely, although this will not deliver quick gains.