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Russia’s Invasion of Ukraine and Firm Performance in Central Asia : The Role of Export Links and Digital Gains

Author

Listed:
  • Dalvit,Nicolo
  • Iootty De Paiva Dias,Mariana
  • Melecky,Martin
  • Srinivasan,Nithya

Abstract

This paper studies the effect of Russia’s invasion of Ukraine on the performance of firms in Central Asia. It uses unique data from the Business Pulse Survey run by the World Bank in the Kyrgyz Republic, Tajikistan, and Uzbekistan, which tracks the sales and employment—along with other main characteristics—of about 1,200 to 1,800 firms in a panel structure. The survey contains two waves before and one wave after Russia’s invasion of Ukraine. Using the difference-in-differences methodology in a regression setup, the analysis finds that Central Asian firms with pre-invasion trade links to Russia suffered greater drops in sales and employment after the invasion—even though exporters to Russia may have experienced, on average, higher sales during the studied period. Considering the pre-invasion digitization of firms, the findings show that digitization helped firms increase their average employment during the studied period. However, the analysis does not find any significant mitigating effect of digitalization associated with the impact of the invasion.

Suggested Citation

  • Dalvit,Nicolo & Iootty De Paiva Dias,Mariana & Melecky,Martin & Srinivasan,Nithya, 2023. "Russia’s Invasion of Ukraine and Firm Performance in Central Asia : The Role of Export Links and Digital Gains," Policy Research Working Paper Series 10557, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10557
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    References listed on IDEAS

    as
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    2. Rüdiger Bachmann & David Baqaee & Christian Bayer & Moritz Kuhn & Andreas Löschel & Benjamin Moll & Andreas Peichl & Karen Pittel & Moritz Schularick, 2022. "What if? The economic effects for Germany of a stop of energy imports from Russia," SciencePo Working papers Main hal-03881469, HAL.
    3. Nordine Abidi & Mehdi El Herradi & Sahra Sakha, 2022. "Digitalization and Resilience: Firm-level Evidence During the COVID-19 Pandemic," IMF Working Papers 2022/034, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

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