Overshadowed by War and Sanctions
Vasily Astrov, Alexandra Bykova, Rumen Dobrinsky, Selena Duraković, Richard Grieveson, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanović, Artem Kochnev, Niko Korpar, Sebastian Leitner, Isilda Mara, Bernhard Moshammer, Olga Pindyuk, Sandor Richter, Bernd Christoph Ströhm, Maryna Tverdostup, Nina Vujanović, Zuzana Zavarská and Adam Żurawski
wiiw Forecast Report No. Spring 2022, April 2022
151 pages including 32 Tables, and 46 Figures
The current report is only available to members and paying customers. Past issues become freely available online when the next report is released. Several individual sections of the report are freely available to download now (see below).
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Executive summary
by Vasily Astrov
free download
Indicators 2020-2021 and Outlook 2022-2024 - Baseline Scenario
Premium Members only
Summary of key recent macroeconomic data for CESEE, and overview of new wiiw forecasts for 2022-2024 (Excel file)

1. Global overview: Inflation up, growth down
by Richard Grieveson, Branimir Jovanović and Artem Kochnev
Russia’s invasion of Ukraine will have substantial negative impacts for the global economy. The euro area will be affected primarily via a spike in inflation that will eat into real incomes, but also by a hit to confidence, which will weigh heavily on investment. In our baseline scenario, we project growth in the euro area of only 2.5% this year (1.7 percentage points lower than we were anticipating in Winter) and inflation of 6% (2.8 percentage points higher). In the adverse scenario, real GDP will decline by 0.9% and inflation will reach 9.5%.

2. CESEE Overview: Overshadowed by war and sanctions
by Vasily Astrov, Sebastian Leitner and Bernhard Moshammer
The war in Ukraine and Russia sanctions will affect the entire CESEE region, primarily on account of the rising prices of food and energy eating into real incomes as well as trade disruptions. In the baseline scenario, recessions this year will be confined to Ukraine and the bulk of the CIS; elsewhere in CESEE, the growth forecasts have been revised downwards by 1-2 percentage points compared to Winter. In the adverse scenario, half of the CESEE region will slide into recession, while inflation will soar into the double-digit range nearly everywhere. The influx of Ukrainian refugees will partly alleviate labour shortages throughout the region but will also require increased social spending.

3. Convergence Monitor
by Richard Grieveson
You can also buy separate country reports of this report
No. | Title | Author | |
---|---|---|---|
1 | ALBANIA: Price hikes and energy supply issues will hamper growth | Isilda Mara | Details & Buy |
2 | BELARUS: Forced into a Russian orbit | Rumen Dobrinsky | Details & Buy |
3 | BOSNIA AND HERZEGOVINA: Local political tensions leave the country in limbo | Selena Duraković | Details & Buy |
4 | BULGARIA: A weak government struggles with mounting challenges | Rumen Dobrinsky | Details & Buy |
5 | CROATIA: War taking its toll on economic growth | Bernd Christoph Ströhm | Details & Buy |
6 | CZECHIA: Mounting challenges depress otherwise solid growth prospects | Zuzana Zavarská | Details & Buy |
7 | ESTONIA: Heading into the unknown | Maryna Tverdostup | Details & Buy |
8 | HUNGARY: The party is over | Sandor Richter | Details & Buy |
9 | KAZAKHSTAN: Challenges ahead | Alexandra Bykova | Details & Buy |
10 | KOSOVO: Positive and negative spill-over effects expected as international trade adjusts | Isilda Mara | Details & Buy |
11 | LATVIA: Government ready to bear the high cost of cutting economic ties with Russia | Sebastian Leitner | Details & Buy |
12 | LITHUANIA: At the frontline of economic sanctions | Sebastian Leitner | Details & Buy |
13 | MOLDOVA: From boom to bust | Gabor Hunya | Details & Buy |
14 | MONTENEGRO: Mired in uncertainty | Nina Vujanović | Details & Buy |
15 | NORTH MACEDONIA: Too fragile for so many shocks | Branimir Jovanović | Details & Buy |
16 | POLAND: The fight against inflation set to cause collateral damage | Adam Żurawski | Details & Buy |
17 | ROMANIA: On the bumpy road to readjustment | Gabor Hunya | Details & Buy |
18 | RUSSIA: Entering the deepest crisis since the early nineties | Vasily Astrov | Details & Buy |
19 | SERBIA: Walking a tightrope | Branimir Jovanović | Details & Buy |
20 | SLOVAKIA: Yet another blow to the automotive industry | Doris Hanzl-Weiss | Details & Buy |
21 | SLOVENIA: Encouraging economic performance tempered by concerns over inflation | Niko Korpar | Details & Buy |
22 | TURKEY: Back to the eye of the storm | Richard Grieveson | Details & Buy |
23 | UKRAINE: Losses from the war are mounting | Olga Pindyuk | Details & Buy |
Our Spring 2022 Forecast comes at a time of pronounced global uncertainty, arising from Russia’s invasion of Ukraine and wide-ranging Western sanctions on Russia. To take account of this, we distinguish between two extreme scenarios. In the baseline scenario, which assumes no further major Western sanctions and some kind of a ceasefire by the middle of 2022, recessions this year will be confined to Ukraine and the bulk of the CIS; elsewhere in CESEE, growth forecasts have been revised downwards by 1-2 percentage points compared to Winter. However, in the adverse scenario, which assumes a further war escalation and an immediate EU embargo on Russian energy, half of the CESEE region will slide into recession, while inflation will soar into the double-digit range nearly everywhere.
Reference to wiiw databases: wiiw Annual Database, wiiw Monthly Database, wiiw FDI Database
Keywords: CESEE, economic forecast, Central and Eastern Europe, Western Balkans, EU, euro area, CIS, Ukraine, Turkey, convergence, business cycle, coronavirus, labour markets, unemployment, Russia-Ukraine war, Russia sanctions, commodity prices, price controls, trade disruptions, Ukrainian refugees, energy embargo, monetary policy, fiscal policy, impact on Austria
JEL classification: E20, E21, E22, E24, E32, E5, E62, F21, F31, H60, I18, J20, J30, O47, O52, O57, P24, P27, P33, P52
Countries covered: Albania, Belarus, Bosnia and Herzegovina, Bulgaria, Central and East Europe, CESEE, CIS, Croatia, Czechia, Estonia, Euro Area, European Union, Hungary, Kazakhstan, Kosovo, Latvia, Lithuania, Moldova, Montenegro, North Macedonia, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Southeast Europe, Turkey, Ukraine, US, Western Balkans, Austria
Research Areas: Macroeconomic Analysis and Policy, International Trade, Competitiveness and FDI
ISBN-13: 978-3-85209-075-7
Press Releases
Related Presentations
- Welche Folgen hat der Ukraine Krieg? (press webinar presentation in German)
- Overshadowed by war and sanctions (webinar presentation in English)