cost of war
“The Russian war is like a steamroller”
The destruction and economic damage in Ukraine is already estimated at around $ 600 billion. In the “Zero Hour” podcast, Russian expert Ziesemer explains why the sums are already so large and how they are raised.
Every day we see images of massive devastation in Ukraine, destroyed house blocks, factories and roads. Direct physical damage is already estimated to be up to $ 100 billion. According to experts, the total damage, including the collapse of economic output, is expected to be between $ 500 and $ 600 billion. But why are these sums so huge now?
“The Russian war is about trying to conquer territories like a steamroller”, explains Russian expert Bernd Ziesemer in the podcast “The Zero Hour”. “And that goes hand in hand with total destruction.” This is why this war is so expensive. “It must be realized that after only one hundred days, this war is economically the most expensive war we have experienced since the end of the Second World War.” The kind of warfare that is leveling factories and infrastructure has “devastating economic consequences” in a relatively developed country, according to the “Capital” columnist and longtime editor in chief of “Handelsblatt”.
Since the start of the war, there have been experts who have documented the damage quite meticulously. The KSE Institute at the Kyiv School of Economics, which works with the help of drones, is a leader. An employee refers to his team as “horror accountants”. At the end of March, the institute was listing exact figures and damages totaling $ 63 billion. “4,431 residential buildings, 92 factories / warehouses, 378 secondary and higher education facilities, 138 health facilities, 12 airports, 7 thermoelectric / hydroelectric power plants were damaged, destroyed or confiscated”.
As of June 8, the KSE Institute recorded total direct damages of $ 103.9 billion. Since the start of the war, at least “44.8 million square meters of housing, 256 commercial businesses, 656 medical facilities, 1,177 educational institutions, 668 kindergartens, 198 warehouses, 20 shopping malls and 28 oil depots have been damaged, destroyed or confiscated “.
“Such exact estimates are something new that we are experiencing for the first time in this war,” said Ziesemer, who was a correspondent in Moscow in the 1990s and studied the costs of the war for the current “Capital” issue. The lists are part of the “Russia will pay” project to enforce any claims later on.
According to estimates by the Ministry of Economy of Ukraine and the KFE, Ukraine’s total war-related economic losses amount to between $ 543 billion and $ 600 billion. Overall, indirect losses were taken into account, including declining economic output, lack of investment and emigration of workers.
According to Ziesemer, warfare in the south and east in particular has enormous costs. “This is an area three times the size of North Rhine-Westphalia and is also similar in structure to the federal state.” The Donbass is also referred to as the “Ruhr area of Ukraine”. There are many factories there, steel industry, heavy industry, mechanical engineering. “The Russian style of warfare is designed to destroy virtually all infrastructure.”
It is already clear that Ukraine will not be able to handle reconstruction on its own. This requires “enormous effort over the course of many years,” says Ziesemer. “Even now we must realize that we cannot leave Ukraine alone.”
Hear more cost figures for Russia, Germany and the world economy in the new episode of “The Hour Zero”. There is also an update on the stock market crisis and the special meeting of the ECB.
All episodes can be found directly on Audio now, Apple or Spotify or through Google.
The new issue with the research by Bernd Ziesemer will be available from 23 June on newsstands or on https://shop.capital.de/de_DE/einzelhefte/individual-issues