WASHINGTON: Rebuilding Ukraine’s economy after Russia’s invasion more than a year ago is now expected to cost $411 billion, 2.6 times Ukraine’s expected 2022 gross domestic product, a new study by the World Bank, United Nations, European Commission and Ukraine found.
The estimate released Wednesday covers the period spanning one year from Russia’s invasion on Feb. 24, 2022 and quantifies the direct physical damage to infrastructure and buildings, the impact on people’s lives and livelihoods and the cost to “build back better,” the World Bank said.
The amount is up sharply from an estimate of $349 billion released last September.
The new projection comes a day after the International Monetary Fund said its staff had reached agreement with Ukrainian authorities on a four-year $15.6 billion loan package that could leverage billions more in aid from other bodies, once approved by the IMF’s executive board in coming weeks.
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“Energy infrastructure, housing, critical infrastructure, economy and humanitarian demining are our five priorities for this year,” Ukrainian Prime Minister Denys Shmyhal said in a statement on the assessment.
He said the estimated damage and recovery needs did not include data on the loss of infrastructure, housing and businesses in territories now occupied by Russian forces.
According to the rapid needs assessment, Ukraine will need $14 billion for critical and priority reconstruction and recovery investments in 2023, which will require $11 billion in financing beyond that addressed in Ukraine’s 2023 budget.
Some 22% of the needs are in transport, while housing accounts for 17%, energy 11% and agriculture 7%.
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The largest proportionate increase was in energy, where damage was more than five times the level seen in June 2022, the World Bank said. The biggest jumps came in frontline regions such as Donetsk, Kharkiv, Luhansk and Kherson, which have been heavily targeted in Russian missile attacks since October.
The World Bank’s vice president for Europe and Central Asia, Anna Bjerde, hailed Ukraine’s resilience and determination in tackling the urgent recovery and reconstruction needs.
“Continued support for Ukraine is an investment in both the country and the global economy. Development partner support for public investment needs to be complemented by significant private investment to increase the available financing for reconstruction,” she said.