Russia’s war in Ukraine could almost halve world trade growth this year and drag down global GDP growth too, the World Trade Organisation projected Monday.
The WTO said that the Russian invasion had not only created a humanitarian crisis of “immense proportions” but had also dealt a “severe blow” to the global economy.
It also said that in the longer term, the conflict could even spark a disintegration of the global economy into separate blocs.
The Geneva-based global trade body issued its first analysis of the impact of the war ahead of its annual world trade forecast report on Tuesday.
It said that while the shares of Russia and Ukraine in overall world trade and output are relatively small, they are important suppliers of essential products, notably food and energy.
“Using a global economic simulation model, the secretariat projects that the crisis could lower global GDP growth by 0.7 to 1.3 percentage points, bringing growth to somewhere between 3.1 per cent and 3.7 per cent for 2022,” the WTO said.
“The model also projects that global trade growth this year could be cut almost in half from the 4.7 per cent the WTO forecasted last October to between 2.4 per cent and three per cent.”
Russia invaded Ukraine on February 24 and the war is grinding toward its seventh week.
The WTO said that some regions would be more strongly affected by the war than others.
