The World Bank confirmed the forecast for Ukraine's gross domestic product (GDP) growth by 3.2% in 2024, but sharply worsened it for 2025 – from 6.5% to 2%.

"The 2025 growth projection for Ukraine is downgraded by 4.5 percentage points, to 2 percent, reflecting the assumption of continued military hostilities," according to the Europe and Central Asia (ECA) Economic Update, published on Thursday.

At the same time, the World Bank improved its growth estimate for 2026 by 1.9 percentage points, to 7%.

According to the review, the bank improved its forecast for Russian economic growth for this year and next by 0.3 and 0.2 percentage points, to 3.2% and 1.6%, respectively, while the aggressor country's GDP growth estimate of 1.1% in 2026 was left unchanged.

"Russia is expected to grow 1.6 percent in 2025, half as fast as this year, as it will be restrained by tighter [monetary] policies and capacity constraints," the publication said.

According to Antonella Bassani, World Bank Vice President for Europe and Central Asia, the region has successfully weathered recent shocks related to high inflation, the aftermath of Russia’s invasion of Ukraine, and slow economic growth in the European Union.

The region’s growth is expected to slow to 3.3% this year from 3.5% in 2023, and to decline further to 2.6% in 2025.

To boost productivity growth in the long term, Bassani recommended that countries in the region significantly improve the quality of secondary and tertiary education.