Home News Morgan Stanley sees Ukraine GDP slump by 60% in 2022 if “no clear resolution”

Morgan Stanley sees Ukraine GDP slump by 60% in 2022 if “no clear resolution”

by wrich
Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

LONDON (Reuters) – Morgan Stanley said on Wednesday Ukraine’s economy could slump as much as 60% year-on-year in 2022 in case of a “more prolonged conflict with no clear resolution” following Russia’s invasion.

The bank considers this would be the worst case scenario, which included Ukraine losing access to the Black Sea in the south. The bank’s base case scenario is a 39% GDP contraction in 2022, factoring a prolonged conflict “with fading intensity.”

“While the external balance deterioration should be limited due to a major imports drop, fiscal and more broadly funding needs are a major challenge” wrote Morgan Stanley economists in a note.

Ukraine’s sovereign international bonds are currently pricing in a “light” debt restructuring with “all payments cleared until 2026 yet no haircut, at a conservative exit yield of 14%”, the note added.

On Wednesday, Ukraine’s $1 billion bond due in September 2022 traded at just under 70 cents in the dollar while most of the remaining issues were bid between 34 cents and 47 cents, Refinitiv data showed.

Morgan Stanley sees Ukraine financial needs at $4.7 billion a month and said how the country will use international aid for reconstruction will play a key role in the economy’s long-term outlook.


(Reporting by Jorgelina do Rosario, editing by Karin Strohecker)


You may also like