The World Bank on Sunday forecast that the war would slash Ukraine’s economic output this year by 45 per cent, as half of the country’s businesses are closed, maritime exports are cut off and much productive capacity is destroyed.

The World Bank is preparing a $1.5 billion support package for war-torn Ukraine and plans to aid developing countries struggling to keep up with surging food and energy prices, World Bank President David Malpass said on Tuesday.

The World Bank was created in 1944 to help Europe rebuild after World War Two. As we did then, we will be ready to help Ukraine with reconstruction when the time comes, Mr. Malpass stated.

The World Bank's Presidet said the package was enabled by Monday’s approval of $1 billion in International Development Association (IDA) aid by donor and recipient countries, along with a $100 million IDA payment to neighboring Moldova.

A World Bank spokesperson said that in addition to the $1 billion in funding from IDA’s 19th replenishment round, the bank’s main concessional lending arm, the International Bank for Reconstruction and Development (IBRD) would provide $472 million in loan guarantees.

The aid comes on top of about $944 million in fast-disbursing financing approved by the World Bank last month, which also includes donor country contributions. That package includes $350 million in budget support financing from the IBRD.

Mr. Malpass has previously said the bank was working on about $3 billion in total near-term aid for Ukraine.

He said the World Bank was analyzing global impacts of the war, including the spike in food and energy prices, and is “preparing a surge crisis response that will provide focused support for developing countries.” The spike in food prices needs immediate attention, with Mr. Malpass adding that for every one percentage point increase in food prices, 10 million people are expected to fall into extreme poverty.