Rostyslav Shurma, Deputy Head of President’s Office, in his interview with RBC-Ukraine media outlet, told about the threats for Ukraine’s economy due to the risks of a Russian invasion.
“We see that the irreversible losses in such a stressful situation are 2-3 billion dollars a month. This includes halted investment, additional inflation, losses in the tourism sector, reduced air traffic. There is still speculative pressure on the financial markets, which blocks borrowing, pushes the exchange rate. This is a separate amount. Speculative pressure on the foreign exchange market is about 1.5-2 billion dollars,” he said.
“We believe that the $ 4-5 billion financial cushion should be enough to continue the government programs we have planned. But the external situation may change,” Deputy Head of Zelensky’s office noted.
The conflict with Russia has cost Ukraine US$280 billion between 2014 and 2020 according to a report by Cebr, UK’s leading economics consultancies:
- New analysis by Cebr shows that Ukraine’s lost output between 2014 – 2020 attributable to the conflict with Russia totals US$280 billion, or up to US$40 billion a year, 19.9% of Ukraine’s pre-conflict GDP
- The 2014 annexation of Crimea alone is worth up to US$58 billion in lost GDP to Ukraine
- The ongoing conflict in Donbas has cost Ukraine up to US$14.6 billion a year between 2014 – 2020
- The conflict has had a major impact on trade and investment, and has led to substantial losses of assets and tax revenues
In January 2022, Bloomberg reported that the sanctions that are applied to Moscow due to the threat of a military invasion of Ukraine are causing serious damage to the Russian budget. A ban on Western funds buying state-issued debt, costing Russia $10 billion a year A retroactive ban on foreign participation in local state debts, costing $60 billion Halting access to the Swift payment system, which would make it much more difficult for Russia to collect payments on $535 billion of exports a year.
Swedish economist and a Senior Fellow at the Atlantic Council Anders Åslund assures that Russian economy could grow 2.5-3% more each year if there were no sanctions. “Most importantly, Russia could take more loans. Other developing countries took out 30% more loans than Russia. Russia has lost these resources. At the same time, foreign investment has practically come to a halt. The total amount that Russia has lost over the course of 7 years, according to our calculations, is 950 billion dollars,” he said.