The European Bank for Reconstruction and Development (EBRD) is forecasting that Ukraine will slump into a deep recession this year, while Russia's economy will face stagnation.
The London-based EBRD is holding its annual meeting in Warsaw.
It says Ukraine's economy will shrink by 7.0 percent in 2014, shredding its previous 2014 growth estimate of 1.5 percent.
Meanwhile, the EBRD said Russia is set to post zero economic growth this year, before expanding by just 0.6 percent in 2015.
The EBRD was founded to help ex-Soviet bloc countries make the transition to free-market economies and democracy.
On May 12, the Ukrainian government signed a pledge to fight corruption.
The EBRD said "combatting corruption in Ukraine has become increasingly urgent because of the impact it is having on the willingness of companies to invest in the country."
Based on reporting by AFP and Bloomberg