As of March 24, the damage caused to Ukraine’s infrastructure during the war has already reached $63 billion, or more than UAH 1,8 trillion.
Compared to the previous estimate published on March 17, taking into account the new data on damage, as well as improving the methodology and more accurate assessment of various objects, the condition of which can be better determined, net growth amounted to $3.5 billion.
This can be seen from the analysis carried out by the KSE Institute team (the analytical unit of Kyiv School of Economics) within the framework of the Russia will pay project and volunteers from partner organizations, in particular, from the Center for Economic Strategy and Prozorro.Sale.
As estimated by the Ministry of Economy and KSE, the overall Ukraine’s economic losses due to the war, taking into account both direct losses calculated in this project and indirect losses (GDP decline, investment cessation, outflow of labor, additional defense and social support costs, etc), range from $543 billion to $600 billion.
Since the beginning of Russia’s military aggression on February 24, at least 4431 residential buildings, 92 factories/ warehouses, 378 institutions of secondary and higher education, 138 healthcare institutions, 12 airports, 7 thermal power plants/hydroelectric power plants have been damaged, destroyed or seized in Ukraine.
As part of the preparation of update calculations, we received detailed data from the Ministry of Infrastructure on the destruction of infrastructure in its facilities, which allowed us to clarify, and in some cases (railway infrastructure, bridges and bridge crossings, civilian airports) – to reduce the assessment of losses. Based on the World Bank’s experience in analyzing losses in Syria and Iraq, as well as the recommendations of the leading Ukrainian investment company Dragon Capital, we have improved the methodology of assessing losses from the destruction of residential real estate. In addition, to the estimate of losses from destruction was added the calculation of expenses for the dismantling of destroyed buildings and repairing to settlement in buildings, which will be built.
We are going to continue this work in the future, which will allow us to detail the assessment of the object by regions and types of buildings, losses of utilities and infrastructure, etc.
The project focuses on assessing the damage caused to Ukraine’s physical infrastructure during the war (destruction of residential buildings, utilities, roads, railways, educational and medical facilities, etc.); and estimating the financial value of these damages. At present, the project does not assess total economic losses, including not only direct infrastructure losses but also numerous “incidental” costs to the economy due to the war (closure of many businesses; loss of hundreds of thousands of homes and jobs; termination of any investments; reduction of consumer demand, etc.).
* The amount increased because of methodology revision, besides data updates
** The amount decreased because of an updated number of affected objects
Every citizen can also submit information about the loss of physical infrastructure, including residential buildings, due to the war. For this purpose, the KSE Institute team has created the RUSSIA WILL PAY resource (https://damaged.in.ua/), where every citizen can submit data on damage to buildings, businesses, roads, and other facilities right now.
The resource was launched in collaboration with the Office of the President and the Ministry of Economy of Ukraine.
It is aimed at collecting information about all the facilities destroyed as a result of the war that Russia waged against Ukraine. The Ukrainian government will use this data as evidence in international courts for Russia to compensate for the intended damages.
For the information to be processed and used, it should be reliable and structured. In particular, it is necessary to fill out the form on the portal as thoroughly as possible, add videos and photos of a facility, and contacts of witnesses, if possible.
You can also submit information about damages using the chatbot https://t.me/Damage_in_ua_bot .
The resource contains information collected by the KSE team and volunteers about damage to physical infrastructure and residential buildings from the beginning of the war.
Confidentiality of the data is guaranteed to anyone who provides information about destruction using the portal and the chatbot. Information about specific damages during the war will not be made public: only generalized statistics will be available publicly.
Methods for evaluating financial losses from damage to the project:
These calculations are based on the analysis of several thousands of public notifications from Ukrainian citizens, the government, local authorities about losses and damages throughout the country, as well as indirect assessment methods such as calculating the estimated area of the war-damaged property in the most affected cities.
The updated calculations have been adjusted to take into account some changes in the methodology. (1) Indirect methods of estimating the value of destroyed residential real estate have been used due to the lack of regular public updates on the total number of destroyed and damaged dwellings, in particular by region and the number of private / apartment buildings (see below). Also, the assessment of the value of damaged and destroyed housing now also includes the assessment of the need for expenditures for the dismantling of destroyed buildings and repairs in the buildings to be built; (2) the valuation of the assets of enterprises no longer takes into account depreciation and added work in progress and inventories; (3) receipt of updated and detailed data from the Ministry of Infrastructure on the current amount of damaged / destroyed infrastructure objects, as well as their replacement value.
These estimates are not exhaustive: information on numerous damages and destruction may be missing due to the inability of citizens, local and state authorities to promptly record the damage in each city and town. Also, due to the lack of information at this stage, the assessment includes only losses from destruction / destruction of buildings, not taking into account the cost of equipment (including hospitals, research institutions, damaged vehicles, etc.). These estimates will be gradually added in the next stages of updating the indicator.
Currently, the evaluation does not take into account information on damage to natural resources, animal husbandry, stocks of companies (in warehouses, shops, etc.), moveable property, military property, telecommunication operators’ property, etc. caused by combat and mining operations. This information will be supplemented and clarified after the end of hostilities in the relevant regions of Ukraine.