Ukraine refugees to cost Europe $36bn in short term, IMF expert says

More than 14 million Ukrainians have been displaced since Russian invasion

Visitors try on donated used clothes at a humanitarian aid hub for internally displaced people in Odesa, southern Ukraine. Bloomberg

The Ukrainian refugee crisis will probably cost European countries $36 billion in the short term, an International Monetary Fund expert has said.

This comes as the war in Ukraine enters a dangerous and fast-escalating new phase that could quickly create further refugee flows.

Russia’s invasion of Ukraine on February 24 sparked one of the worst refugee crises in European since the Second World War, with more than 14.5 million people displaced. Just over half stayed in Ukraine, while seven million people fled abroad — mostly to other European countries.

Poland has taken in 1.4 million refugees, followed by Germany, which has taken in 1 million. The Czech Republic is currently accommodating nearly 400,000 Ukrainians.

“The response by European countries showed that a more co-ordinated and effective revenue policy is possible when there is political will,” Nicolo Bird, an IMF technical assistance adviser, said at a fund event in Washington on Tuesday

Mr Bird estimated that the short-term cost would be $36bn.

“Given the growing refugee crisis across the world, important lessons can be drawn from the treatment and management of the Ukraine refugee crisis in Europe.”

The influx of refugees to European countries has already placed an economic burden on those housing them.

Mr Bird urged European countries to plan for the short and long term, as the conflict in Ukraine appears to have no immediate end in sight.

When it does conclude, he expects a long reconstruction process.

Europe has embraced Ukrainian refugees in a way not afforded to those fleeing other conflicts and disasters.

Mr Bird said he hoped this united front will serve as a template for how the international community handles future refugee crises.