EBRD: Ukraine War Sparking Turmoil for World Economy

EBRD: Ukraine War Sparking Turmoil for World Economy

The Ukraine war has major economic consequences for energy, food, inflation and poverty, according to the European Bank for Reconstruction and Development.

The EBRD's chief economist, Beata Javorcik, spoke to AFP about the fallout from Russia's invasion of Ukraine, from where more than three million refugees have fled so far.

Global lenders are giving billions for Ukraine, including a 2.0-billion-euro ($2.2 billion) "resilience package" from the London-based EBRD, but there is currently no end in sight to the conflict.

The crisis has sent commodity prices rocketing on supply fears, fueling inflation that is already at multi-decade highs.

AFP: What are the costs to rebuild Ukraine?

Beata Javorcik: The costs of this war will depend on how long fighting will last. Big parts of the country are functioning -- infrastructure is there, the banking system is functioning, businesses are still open. But it's very hard to quantify.

The (rebuild) figure of $100 billion comes from the Ukrainian government ... and is the cost of infrastructure and buildings that have been destroyed. It's equivalent to about two thirds of GDP.

According to the Ukrainian government, half of the firms have closed down and other firms are working at reduced capacity.

That shows that the economic cost is going to be