Rebuilding Ukraine's economy after nearly two years of war is expected to cost $486 billion, 2.8 times its 2023 expected economic output, a new study by the World Bank, United Nations, European Commission and the Ukrainian government found, Report informs via The Jerusalem Post.
The estimate quantifies the direct physical damage to buildings and other infrastructure, the impact on people's lives and livelihoods and the cost to "build back better," the World Bank said.
That 10-year cost estimate is up from $411 billion last March, with housing needs topping the list at $80 billion or 17%, followed by transport needs of $74 billion or 15%, and commerce and industry at $67.5 billion, or 14%.
"The $486 billion is an unfathomably large amount, and, of course, it reflects real needs," said Arup Banerji, World Bank regional country director for Eastern Europe, although he noted that the high rate of damages seen in the first months of the war had slowed sharply.
The report said Ukraine needed some $15 billion to cover the most urgent repair, recovery and reconstruction priorities in 2024, of which about $5.5 billion had already been met through the state budget and donor support.
Banerji lauded the Ukrainian government for squeezing "every cent they could" out of their budget to cover costs, including social transfers to keep citizens from falling into abject poverty. They also planned to undertake some 200 separate reforms to governance, energy and other areas, he said.
He said the Ukrainian economy had proven remarkably resilient in the face of the war. News that over $4 billion in foreign direct investment had flowed into Ukraine in the first three quarters of 2023 showed that foreign investors saw good opportunities, he said.
Four of five firms continued to operate in Ukraine, despite the war, with many relying on digital operations or moving sites to stay in business, he added.
The report noted that as of December, about 5.9 million Ukrainians remained displaced outside of the country, compared with 8.1 million reported in the last needs assessment in 2023. The number of internally displaced persons had also gone down to around 3.7 million, compared with 5.4 million in spring 2023.
