Russia’s full-blown invasion of Ukraine, which began on February 24 2022, has irrevocably changed the lives of millions of people. The largest land conflict in Europe since the end of the second world war has sent shockwaves worldwide, redefining the global economy, politics and security in the process.

As the first anniversary of the day Russia invaded Ukraine approaches, the conflict’s impact on global trade, investment and economic development cannot be understated. Here are five charts showing some of the major ripples caused by the war:


Ukrainians fleeing the fighting

First and foremost, Russia’s military action has caused a humanitarian crisis. More than eight million refugees fleeing fighting in Ukraine have been recorded across Europe, according to UN figures — almost 60% of which were in countries bordering Ukraine.

Several nearby countries opposed to Russia’s invasion, including Poland, Georgia and the Baltic states, quickly provided humanitarian aid for refugees and business support programmes. Among Western countries, Poland has welcomed the largest number of refugees at 1.56 million, followed by Germany (1.05 million) and the Czech Republic (489,000).

While some multinationals have evacuated their local Ukrainian staff, others relocated their operations to other parts of Europe. In spite of the war, at least 26 companies decided in 2022 to go ahead with investments in Ukraine, according to fDi Markets data.

Russia had recorded the highest number of refugees from Ukraine at 2.85 million as of October 2022; however, hundreds of thousands of people have also left the country since the war began. In the first nine months of 2022, almost 320,000 Russian citizens entered Uzbekistan, more than double the figure from the same period of 2021, according to the State Statistics Committee of Uzbekistan. 

Corporate exodus


There has been a mixed business response to the Kremlin’s military aggression. More than 1000 companies have withdrawn from Russia or suspended their operations in the country, according to a list compiled by the Yale School of Management. 

“It is the biggest exodus of business in world history,” says Jeffrey Sonnenfeld, the founder of Yale’s Chief Executive Leadership Institute who led the research team behind the list. 

While the remarkably widespread retreat of investors from Russia has put business’s role in society into a new perspective, many executives have ploughed ahead in the country regardless. Around 420 companies are either buying time or continuing with their business activities as usual in Russia, according to Yale’s list.

Mr Sonnenfeld notes that whether companies decided to leave Russia is not explained by their nationality, industry or profitability. It is better explained by the “ideology of the company’s CEO or their intransigence”, he adds. Many foreign investors that have written off or sold their assets in Russia have included buyback clauses enabling them to reenter the country should it take a different direction, including Danish brewer Carlsberg, French carmaker Renault and US fast food giant McDonalds

Foreign investors shy away from Russia

The pullback from Russia is evident from the lack of new foreign investments in the country. As was the case in 2014, following Russian president Vladimir Putin’s decision to annex the Crimean peninsula, announced greenfield foreign direct investment (FDI) projects in Russia plummeted in 2022. 

Last year, only 13 FDI projects were tracked in the country — the lowest level since records began in 2003, according to fDi Markets. In almost every year prior to 2022, western European investors accounted for roughly half of Russia's greenfield investments. Last year, this share had fallen to just 23.1% in 2022. 

Among the foreign investors still ploughing ahead in the country were Turkish heat engine maker Brox, which is planning to build an industrial steam boiler plant in the Russian town of Furmanov. Kronospan Holdings, an Austrian-founded and Cyprus-based wood panel and laminate flooring manufacturer, is also set to build a logistics centre in Kaliningrad, Russia’s semi-exclave bordering Lithuania and Poland.

Energy crisis and booming fossil fuel investment

Russia’s invasion of Ukraine sent energy prices soaring in 2022, pushing up bills for consumers and companies in countries across the globe. This helped energy majors post record profits and fomented the otherwise unexpected return of fossil fuel investment.

According to IMF data, in August 2022, natural gas prices in the EU reached about $70 per metric million British thermal metric unit — the unit traditionally used to measure heat content or energy value. This was 159% higher than just before the Ukraine invasion and more than four times the price a year earlier.

Amid higher prices and a push to find alternative supplies to Russia, foreign investors pledged more capital to oil and gas extraction projects than any year since 2009, according to fDi Markets. More than $57bn of capital expenditure was announced in 2022 — around three times the average of the previous ten years. 

At time of writing, several factors have helped European natural gas prices fall back to their level before the Ukraine war, including a warmer winter than expected, gas stockpiling and investments into infrastructure in Europe, such as new liquified natural gas terminals in Germany. While prices have regulated, global energy trade flows have been permanently changed since the war began. In January 2022, Europe was the destination for more than half of Russian crude oil shipments, according to Kpler and Bloomberg data. By the end of 2022, China and India accounted for more than 80% of Russian oil sales, while Europe’s share had fallen to less than 8%. 

Russians seek safe havens

RecFaces, a biometric identification company founded in Moscow back in 2014, is one of many Russian tech companies that have set up an international presence since the Ukraine invasion. In November 2022, the company said it had relocated its global headquarters to Dubai Media City, which will allow it to operate “completely autonomously” and “act independently on a strategic level”.  

The UAE, China and Turkey have all seen an increase of Russia-sourced FDI projects since the Ukraine invasion, according to fDi Markets data comparing 2022 with the pre-war (2017–2021) average. The Gulf nation, which was the leading destination country globally in 2022 for Russian companies, has seen an influx of entrepreneurs and investors due to Western sanctions placed on the Russian economy.

Russia has become the most sanctioned country in the world since its invasion of Ukraine, ahead of Iran, Syria and North Korea. More than 11,000 Western sanctions have been applied to Russian individuals, entities and assets since February 2022, according to Castellum.AI data. While these sanctions have made it more difficult for many businesses operating in the country, some western goods are still widely available in Russia due to exports from countries that have not imposed sanctions. In 2022, trade between the UAE and Russia increased by 68% to reach $9bn — their highest level ever, according to figures cited by state-owned Russian news agency Tass.