Ukraine Targeted Analysis

• In Ukraine:

  Economic activity has improved and domestic supply chains have recovered relative to the start of the conflict. This has facilitated the resumption of business activity and improvement in household access to income-earning opportunities in many areas, though economic activity remains significantly depressed relative to pre-invasion levels. Though the future of the conflict remains uncertain, the Ukrainian economy is expected to continue its trajectory of gradual recovery through May 2023 alongside significant international support and improved domestic supply chains.

• Through May 2023, already elevated domestic prices are likely to continue rising despite the overall trend of relative economic recovery. Additionally, high fuel prices will further strain households’ purchasing power during the winter months. Some poor households currently facing Stressed (IPC Phase 2) outcomes will likely exhaust available coping strategies such as spending savings, borrowing, and reducing essential expenditures. However, this number is expected to be limited due to expanded government social support and humanitarian interventions in the country.

• Currently, worst-affected poor households — including poor farmers who are struggling with below-average income levels and poor urban households that depend on informal employment and/or lower-wage jobs — are likely Stressed! (IPC Phase 2!) if they receive assistance or in Crisis (IPC Phase 3) if they do not receive assistance. Of the estimated 30 million people remaining in Ukraine, an estimated 1-2.49 million people (3-8 percent of those in the country) are likely in immediate need of humanitarian food assistance to prevent food consumption gaps and damage to livelihoods. The population in need is expected to increase within this range throughout the projection period due to declining purchasing power. Most of those in need are located in conflict-affected areas where disruptions to income-earning activity, interruptions to supply chains, and damage to essential infrastructure, including water and heat, have occurred.

• Globally:

  The effects of the war in Ukraine have driven up essential food and non-food prices around the world, further reducing poor households’ ability to afford their basic kilocalorie needs. These impacts coincide with the impacts of conflict and drought in many countries, including in the Horn of Africa, where a fifth consecutive poor rainfall season in late 2022 will continue to drive unprecedented drought conditions. Households face not only extensive crop and livestock losses due to local shocks but also steep increases in imported food prices, leading to warnings of Famine (IPC Phase 5).

• Global commodity prices — including for food, fertilizer, and fuel — are likely to remain elevated throughout the projection period. In many already food-insecure countries, farmers are unable to afford essential agricultural inputs, and high fertilizer prices are likely to reduce planted acreage and yields in the coming production seasons.

• In the current environment of high global assistance needs and inadequate resources for assistance, the world is also facing prospects for an impending global recession, continued high levels of inflation, and more frequent extreme weather events and water crises due to the impacts of climate change. The continuation of a status quo defined by a limited emergency response will not prevent but rather permit the ongoing spiral of eroding resilience and, overall, rising levels of acute food insecurity amid the compounding effects of future shocks. It is essential that donor countries urgently direct efforts toward addressing the root causes of food insecurity — particularly conflict and climate change — and think more creatively about how to address acute food needs while supporting local livelihoods and economies.

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