Mar 30, 2022 - Economy

War in Ukraine projected to trigger global growth slowdown

Projected 2022 GDP change in G7 countries, before and after the Ukraine war
Data: Economist Intelligence Unit; Chart: Will Chase/Axios

The war in Ukraine will cool what was supposed to be a hot economy this year, finds a new analysis by the Economist Intelligence Unit.

Why it matters: Economic ripple effects from the war — like the surge in commodities prices and the supply chain disarray that's ensued — will spread far outside the borders of Ukraine and Russia.

Driving the news: The EIU's report, published Tuesday evening, finds the war will knock half a percentage point off of its previous GDP forecast. It now sees the global economy growing 3.4% in 2022.

  • Among G7 nations, the sharpest decline in outlook was in Europe, especially Italy and Germany, which are both reliant on Russian energy imports.

Worth noting: Let's not forget about the people of Ukraine. EIU analysts expect the war with Russia to crater the Ukrainian economy by a whopping 47% in 2022.

  • "We do not believe that Ukraine's GDP will recover to pre-war levels for more than a decade," analysts at the consultancy wrote.
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