90% Of Ukraine’s Population May Face Poverty If War Drags On Till 2023: UN

New York: As high as 90% of Ukrainians may face poverty and extreme economic vulnerability if the Russian invasion drags on to 2023, UN Development Programme (UNDP) said on Wednesday.

UNDP Administrator Achim Steiner said the United Nations is working with the Ukrainian government to prevent a worst-case scenario of the economy collapsing, thereby wiping out two decades of economic gains.

Among UNDP’s plans is to provide cash transfers to war-hit families to buy food and prop up basic services so that they are not forced to flee their country.

“If the conflict is a protracted one, if it were to continue, we are going to see poverty rates escalate very significantly… Clearly, the extreme end of the scenario is an implosion of the economy as a whole. And that could ultimately lead to up to 90% of people either being below the poverty line or being at high risk of (poverty),” Steiner told Reuters in a video interview from New York.
He went on to say that whereas the poverty line is generally defined as the purchasing power of $5.50 to $13 per person per day, about 2% of Ukrainians lived below the $5.50 line before Russia launched its invasion on February 24.

“We estimate that up to 18 years of development gains of Ukraine could be simply be wiped out in a matter of 12 to 18 months,” Steiner said.

The Ukraine government’s economic adviser said last week that Russian forces have destroyed at least $100 billion worth of infrastructure, while 50% of Ukrainian businesses had shut down completely.

“Cash transfers programmes, particularly in a country such as Ukraine where the financial system and architecture is still functional, where ATMs are available, a critical way in which to reach people quickly, is with cash transfers or a temporary basic income,” Steiner said, adding that logistical challenges were significant but not ‘insurmountable.’

An IMF report said Ukraine’s economy is likely to contract by 10% in 2022, but the situation could be far worse if the conflict lasts longer.

The World Bank on Monday approved $200 million to help Ukraine support vulnerable people.