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President Vladimir Putin’s invasion of Ukraine will cause that country’s economy to contract by almost half -- or 45.1% -- this year, while Russia’s will shrink by 11.2%, according to the World Bank.

Emerging market and developing economies in Europe and Central Asia are projected to decline by a combined 4.1% this year, twice the drop triggered by the onset of the Covid-19 pandemic in 2020, the World Bank said in its spring forecasts published on Sunday. It said the estimates are subject to considerable uncertainty.

“This is the second major shock to hit the regional economy in two years and comes at a very precarious time for the region, as many economies were still struggling to recover from the pandemic,” World Bank Regional Vice President Anna Bjerde said on a conference call.

Aside from emerging Europe, the war is reverberating through commodity and financial markets, as well as trade and migration links, adding to concerns of a sharp global economic slowdown, spiraling inflation, and growing debt, the World Bank said. 

Besides Russia and Ukraine, the economies of Belarus, Kyrgyzstan, Tajikistan and Moldova are also forecast to shrink in 2022, with the rest of the region growing at an “anemic pace,” according to the report.

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