The Effect of Ukraine-Russia War on the Economies of Ukraine’s Top Trading Partners

Abstract

This research paper studies the impact of the Ukraine-Russia war on the economies of Ukraine’s top trading partners. Several earlier studies ([9], [3], [8]) have examined the implications of the war for global trade and development [13], and how countries highly dependent on exports from the conflict region have responded. In our paper, we focused only on Ukraine, analyzed both import and export partners of Ukraine, and developed a framework to assess the impact of the war on various macroeconomic indicators for these partner countries. In particular, we established Difference-in-Difference based statistical models for Gross Domestic Product (GDP), food inflation, manufacturing production, gasoline prices and changes in inventories the for partner and non-partner countries over the pre-war and post-war years from 2021 through 2023. Our findings contribute to a better understanding of the devastating and far-reaching economic effects of the Ukraine-Russia war that serve as a cautionary tale for world citizens and leaders alike.