Ukraine losing up to $3 B a month amid escalation fears – President’s Office

Due to the threat of Russian invasion, Ukraine loses 2 to 3 billion U.S. dollars a month due to suspended investment and additional inflation.

That’s according to Rostyslav Shurma, Deputy Head of the President's Office, who spoke with RBC-Ukraine, Ukrinform reports.

"We see that irreversible losses amount to 2 to 3 billion dollars a month in such a stressful situation. This includes suspended investments, additional inflation, losses in the tourism sector, and reduced air traffic," Shurma said.

According to the official, there is also speculative pressure on financial markets, which blocks borrowing and pushes the exchange rate up. Shurma estimates this type of pressure at 1.5-2 billion dollars.

“Losses for the economy stand at about 2 to 3 billion dollars, that’s the damage we incur every month. Also, 4 to 5 billion is a ‘cushion’ for us to proceed with involving resources for development. You see objectively what kind of decisions an investor would make in this situation. Of course, everyone is putting projects on hold. They are not canceling, but postponing decisions. Also, foreign credit markets are temporarily shut," Shurma said.

The official noted that if the stress level prevails, the monthly losses will remain the same they have been since January.

"If the situation stabilizes in the information space at least in its current state, the pain threshold will rise, and in two months there will be no such losses," Shurma added.

As Ukrinform reported earlier, on February 21, the EU Council approved a proposal put forward by the European Commission to provide Ukraine with additional emergency macro-financial assistance in the amount of EUR 1.2 billion.

The EU has accelerated the process of approving economic assistance to Ukraine, as the current geopolitical tensions are affecting Ukraine's economic and financial stability. In particular, persistent security threats have caused significant capital outflows. Ukraine is losing access to international capital markets due to growing geopolitical uncertainty and its impact on the economic situation.

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