Kyiv Calculates Financial Cost After Two Weeks Of Russian Invasion
Poppy Bilderbeck
Featured Image Credit: Alamy
Ukrainian economists have calculated the current total cost of the damage to the country since Russia invaded.
It has been more than two weeks since President Vladimir Putin ordered Russian troops across the border on Thursday, February 24, marking the start of his 'special military operation' in Ukraine, and the country's economy has naturally taken a hit.
Denys Kudin, Ukraine's deputy economy minister, and Oleg Ustenko, chief economic adviser to Ukrainian President Volodymyr Zelenskyy, have since revealed the true extent of the financial damage.
Live on the scene from Southeast Kyiv. This residential building suffered massive damage. Trying to gather facts on what happened. This is 15 minutes from where I live. pic.twitter.com/VzIkxXy0SX
— Terrell Jermaine Starr (@terrelljstarr) February 25, 2022
Today, March 11, Kudin announced that areas of the country that have been worst struck by the invasion have seen around 75% of businesses collapse, The Independent reports.
Ustenko echoed the same sentiment in an online event hosted by the Peterson Institute for International Economics.
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The adviser revealed that the war had caused half of all of the country's businesses to close, reflecting that Ukraine's economy was 'very depressed'. 'Currently around 50 per cent of businesses are not operating and the rest are not operating at full capacity,' he said.
While a 'very approximate' estimate, Ustenko also believes that damage to the country's buildings, infrastructure – such as bridges and hospitals – and physical assets currently totals at least £76 billion ($100 billion).
Up to date, Russia has caused $119B in damage to Ukraine's infrastructure, states First Deputy Minister of Economy Denys Kudin. The figure rapidly increases with each passing day of the war. #StopRussia pic.twitter.com/GNKT0riQnY
— Stratcom Centre UA (@StratcomCentre) March 11, 2022
A 'significant share' of the country's total exports comes from the exportation of metal.
However, that too has been drastically impacted because of a lack of working metallurgical enterprises.
The West's financial sanctions on Russia were noted by Ustenko as being a way for Ukraine to be able to afford to build itself back up again after the war.
Pelosi adds that Zelensky also said in addition to needing planes, anti missile weaponry, armored cars tanks, etc., he also wants “everybody’s help in re-building Ukraine” when the time comes.
— Jacqueline Alemany (@JaxAlemany) March 9, 2022
Despite this, at present, Ukraine's financial system is reported by Ustenko as doing 'OK under the current circumstances'.
ATMs in areas not taken over by Russian forces are still able to be accessed by citizens and bank payment operations are all working too.
'Even in those cities surrounded by now by the Russian army... (residents) are able use their cards,' he said.
The hryvnia currency is reportedly under slight pressure, however, lines for supermarket cashiers are significantly shorter than those seen in the first two days of the invasion.
⚡️IMF: Default no longer "unlikely event" for Russia, predicts a deep recession of Russian economy.
— The Kyiv Independent (@KyivIndependent) March 11, 2022
IMF Managing Director Kristalina Georgieva also said the IMF does not have any interactions with the Russian Government and its Moscow office is non-operational at the moment.
On the opposing side, Russia is reported as beginning to suffer as a result of the long list of sanctions that were unveiled against it by the West.
On Thursday, March 10, Dmitry Peskov, a spokesperson for Putin, admitted that the economy 'is experiencing a shock impact now'.
He said: 'This is absolutely unprecedented. The economic war that has started against our country has never taken place before. So it is very hard to forecast anything.'
However, he stressed that the 'negative consequences' will 'be minimised'.
If you would like to donate to the Red Cross Emergency Appeal, which will help provide food, medicines and basic medical supplies, shelter and water to those in Ukraine, click here for more information