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4 Jan, 2023 00:07

Ukraine estimates cost of reconstruction

The figures range from $700 billion to $1 trillion, as Kiev covets frozen Russian assets
Ukraine estimates cost of reconstruction

Ukrainian Prime Minister Denis Shmygal said on Tuesday that “more than $700 billion” will be needed to repair the damage due to the conflict, double the estimate given by Kiev in June. President Vladimir Zelensky had put the figure at $1 trillion at the end of December. 

“Together with the World Bank, we plan to conduct another verification of Ukraine's needs for a quick recovery,” Shmygal told the cabinet meeting in Kiev, according to the UNIAN news agency. “Let me remind you that we had such an estimate at the beginning of June. Then the figure was $350 billion in damage. Given the latest attacks on our infrastructure, today this amount reaches more than $700 billion.”

Meanwhile, he said that Kiev intends to use the 17 billion hryvnia ($426.6 million) already confiscated from Russian banks on rebuilding residences destroyed in the fighting. The money is “already in the special account,” Shmygal told the government.

This is a lower amount than Zelensky quoted in a statement at the beginning of August, when he said that Kiev had seized “28 billion hryvnias,” or approximately $765 million. Shmygal’s damage assessment was also around $300 billion under Zelensky’s trillion-dollar claim – which was made on the same day (December 30) that the EU gave its own estimate of €600 billion ($633 billion).

The competing claims come amid media reports alleging the growing willingness of some EU politicians to hand the frozen Russian assets to Kiev. The US and its G7 allies had seized some €300 billion ($311 billion) in reserves belonging to the Russian central bank, as well as billions in assets owned by blacklisted Russian businessmen.

Bloomberg reported on Tuesday that the German government was divided on the issue, but would be willing to support the confiscation on condition that legal issues were resolved and that other Western countries did the same.

Last month, the Ukrainian leader revealed that he had hired US asset management company BlackRock to “advise the Ukrainian government on how to structure the country’s reconstruction funds.” 

Zelensky has also proposed a ten-point “peace plan” under which Russia would pay Ukraine reparations for decades and submit to a war crimes tribunal. Moscow has dismissed it as “nonsense.”