LONDON (REUTERS) - Ukraine's economy shrank 16 per cent year-on-year in the first quarter of this year and could contract 40 per cent in 2022 as a result of Russia's invasion, the economy ministry said in a statement on Saturday (April 2), citing preliminary estimates.

"Areas in which remote work is impossible have suffered the most," it said.

Separately, the European Union is working on further sanctions on Russia but any additional measures will not affect the energy sector, the EU's Economic Commissioner Paolo Gentiloni said in Cernobbio on Saturday.

The 27-nation bloc will be faced with a growth slowdown caused by the war in Ukraine but not a recession, he added, saying the 4 per cent growth forecast was too optimistic and the EU would not reach it.