Deep reforms in sectors ranging from budget management to energy are needed to stimulate the Ukrainian economy, the World Bank Group said.

The Ukrainian government that took power in the wake of political upheaval in November 2013 said the ousted administration of President Viktor Yanukovych left the economy in shambles. In its latest assessment, the World Bank said it expects real gross domestic product in Ukraine will drop 7.5 percent this year, compared with a 6.8 percent drop in 2014.

"Exogenous shocks undermined the efforts of authorities to stabilize the economy and jumpstart growth in 2014," Qimiao Fan, World Bank country director, said in a statement. "Faster and deeper reforms are the best antidote to these exogenous shocks confronting Ukraine."

The World Bank said ongoing conflict in the region has undermined investor confidence in Ukraine. A gradual recovery is possible next year, the bank said, if peace takes hold and structural reforms reach to budget management and the energy sector.

Ukraine, a former Soviet republic, serves as a key corridor for Russian gas deliveries to Europe. Ukraine's state energy company Naftogaz, meanwhile, is under the Kremlin's thumb because of contractual rows that predate Ukraine's 2013 pivot toward the European Union.

"Addressing fiscal challenges will require comprehensive and deep reforms. The aim should be to reduce gradually, but durably, the footprint of the government while ensuring better quality and affordable services to all Ukrainians," Fan said.

The World Bank in February pledged $2 billion in funding to help Ukrainian economic reforms.