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Ukraine’s economy will take a $700 billion hit from the war with Russia


Ukraine’s economy is on track to take a $700 billion hit after 10 months of war with Russia by the end of the year, its prime minister said Tuesday.

“According to our estimates, which have been verified by the World Bank, the amount of damage caused to the Ukrainian economy as of June 1 is $350 billion. By the end of the year, this amount will obviously double,” said the Prime Minister Denys Shmyhal. he said during an economic forum in Paris, according to Interfax.

Dozens of countries and agencies pledged to help Ukraine with more than $1 billion on Tuesday to help it get through the winter months as Russia continues to bombard its power grids with airstrikes.

A Ukrainian soldier fires a mortar at Russian positions in Bakhmut, Donetsk region, Ukraine, Thursday, November 10, 2022.
(AP Photo/Libkos, file)

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Russia has increasingly relied on airstrikes and the bombing of civilian infrastructure in an attempt to break Ukraine’s morale by depriving the nation of heat, running water or electricity as the cold winter months begin, a move that defense officials say is due to Moscow’s failures on the front lines

Russia “has chosen a cynical strategy, aiming to destroy civilian infrastructure in order to bring Ukraine to its knees,” French President Emmanuel Macron said on Tuesday. “The objective is clear: to respond to military defeats by sowing terror among civilians, to try to break their backs since they cannot hold the front.”

Ukrainian President Volodymyr Zelenskyy said Ukraine needs emergency generators to help the estimated 12 million who live without electricity as much as its troops need armored vehicles.

Ukraine's President Volodymyr Zelenskiy and servicemen walk in a trench near the front lines with Russia-backed separatists in Krasnohorivka, Donetsk region, Ukraine, August 7, 2020.

Ukraine’s President Volodymyr Zelenskiy and servicemen walk in a trench near the front lines with Russia-backed separatists in Krasnohorivka, Donetsk region, Ukraine, August 7, 2020.
(REUTERS/Gleb Garanich)

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While the sum is expected to provide the assistance Ukraine desperately needs, it falls far short of the actual support kyiv will need to rebuild.

In October, the International Monetary Fund estimated that Ukraine could need up to $5 billion a month to stay afloat if Russia continues its deadly bombing campaign.

Ukrainian soldiers fire artillery at Russian positions near Bakhmut, Donetsk region, Ukraine, on November 20, 2022.

Ukrainian soldiers fire artillery at Russian positions near Bakhmut, Donetsk region, Ukraine, on November 20, 2022.
(AP Photo/LIBKOS)

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The estimates followed projections released by the World Health Organization in early September that said some $97 billion in damage had already been done, mostly in the housing and transportation sectors, though other estimates ranged as high as $130 billion. millions of dollars in damage.

The bank also estimated that total reconstruction needs would cost around $349 billion, though it noted that the figure was expected to “grow in the coming months as the war continues.”

Associated Press contributed to this report.



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