Ukraine may need up to EUR1 trillion in foreign aid to repair the damage caused by the Russian invasion, Bloomberg reports the words of the head of the European Investment Bank, Werner Hoyer, at a press conference in Frankfurt on Tuesday.
“I put (estimate) a trillion because I saw numbers in the public space that I consider completely unrealistic when I see the level of destruction in Ukraine,” Hoyer said.
In his opinion, Europe will have to play the biggest role in these efforts.
The head of the EIB also said that he is currently trying to redistribute the bank’s liabilities in the amount of EUR1 to EUR1.5 billion to restore Ukraine. According to him, the corresponding approval can be obtained as early as this week.
Prime Minister of Ukraine Denys Shmygal, in an interview with Interfax-Ukraine at the end of March, also said that Ukraine’s losses from Russia’s full-scale military aggression, taking into account both the destruction already inflicted on infrastructure and the economy, and future losses in subsequent years, exceed $1 trillion.
According to him, its first component is direct infrastructure damage, which at that time was estimated at about $120 billion, and taking into account military infrastructure and other civilian expenses, more than $270 billion.
The prime minister added that the second component is the calculation of the losses of the Ukrainian economy: the fall in GDP during the war, lost profits and investments – more than $ 290 billion, and the third – the losses received by the state as a result of a decrease in GDP in the future.
According to the State Statistics Service, in 2021, Ukraine’s GDP grew by 3.4% after a 3.8% decline in 2020, its nominal volume amounted to about $200 billion. This year, the fall in GDP is predicted by various experts in the range of 30-45%.
The indicator of economic sentiment in Ukraine, calculated by the State Statistics Service, in the fourth quarter of 2021 increased to 98.7% from 98.5% in the third quarter, from 96.9% in the second and from 90.2% in the first quarter of this year.
According to the State Statistics Service, the indicator of business confidence in retail trade – the only one of five in the area of positive values – deteriorated from 6.8% to 4.3% in the third quarter.
At the same time, the values of other indicators of business confidence improved, albeit slightly: in construction to minus 22.4% from minus 23.6%, in the service sector – to minus 10.8% from minus 12.8%, in processing industry – to minus 6.4% from minus 7.5%.
The consumer confidence indicator rose to minus 21.1% from minus 21.2% in the third quarter.
As reported, the calculation of the economic sentiment indicator was first started in the first quarter of 2017. The index reached a record high level of 110.9% in the fourth quarter of 2019, however, since the onset of the coronavirus crisis in the world, it first dropped to 108.4%, and then collapsed to a record low of 73.3%.
The agency indicated that the indicator was calculated in accordance with the methodology for calculating indicators of business expectations in accordance with the requirements of the expanded Special Data Dissemination Standard of the International Monetary Fund, updated by the State Statistics Service in December 2017.
Business confidence indicators, by sector, are assessed based on surveys on the current level of orders and finished goods inventory, changes in sales volumes over the past three months, forecast of changes in production/sales volumes and the number of employees in the next three months.
The largest contribution in the economic sentiment indicator definition is the contribution of the indicator of business confidence in industry – 40%, followed by the service sector – 30%, construction with retail trade – 5% each. The weight of consumer sentiment is 20%.