As Russia’s aggression against Ukraine enters its third month, the losses suffered by what was once the most industrially developed former Soviet republic appear to be enormous. The World Bank estimates Ukraine’s physical damage at $60 billion,[1] while the Ukrainian government estimates that the country’s restoration after the war will cost more than $560 billion,[2] and some Ukrainian politicians suggest that the country will lose a trillion dollars.

Even if the last figure seems to be an exaggeration, any of the above-mentioned estimates appear to be catastrophic for a nation that prior to Russia’s invasion possessed a $200 billion nominal GDP and lost around ten years of economic growth due to the annexation of Crimea in 2014 and occupation of its eastern regions since 2014-2015.

The Russian military destroyed up to 13 percent of Ukraine’s road network,[3] closed 21 percent of the industrial capacity and more than 72,000 private houses and apartment buildings, including up to 340 hospitals and 1,000 schools and colleges,[4] and forced around 5,200,000 people to flee Ukraine and 7,700,000 to relocate inside the country, in most cases losing their permanent jobs.[5] The European Bank for Reconstruction and Development recently assessed Ukraine’s GDP drop for 2022 at 20 percent,[6] and the World Bank put the figure at 45 percent[7] – meanwhile the atrocities continue and it seems that neither the Russian nor the Ukrainian side possess a will to negotiate the termination of the conflict.

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