Economic Losses Resulting From Crimes Committed By Russia

Russia’s armed aggression, now in its ninth year, has caused extensive damage to Ukraine’s critical infrastructure, energy sector, industry, and economy. The most severe impact was felt following the full-scale military invasion that began on 24 February 2022. According to preliminary estimates from Ukraine’s Ministry of Economy, the country’s GDP declined by 30.4% in 2022, though a year later it saw a 5.3% increase. The World Bank offers similar estimates, reporting a 29.2% drop in Ukraine’s GDP in 2022. However, the true economic losses resulting from Russia’s armed aggression and  crimes committed by the Russian armed forces are far higher, as Ukraine continues to lose its citizens—both soldiers and civilians—who are either victims of missile attacks or are forced to leave the country. Russia’s attacks on civilian infrastructure are not only targeted at residential areas and homes but also, at critical infrastructure; i.e.; buildings, facilities, and installations that provide essential services for the state and society and enable the proper functioning of administration and institutions. Moreover, Russia is deliberately striking cultural, medical, administrative, educational, and scientific institutions and facilities. Damage also affects the natural environment, with substantial costs for demining and clearing unexploded ordnance. According to the Ministry of Environmental Protection and Natural Resources, these costs are already estimated at UAH 10 billion. It is essential to make an accurate estimate of all economic losses as this data can serve as evidence in international proceedings for compensation. It is important to note that Russia’s actions are not solely aimed at gaining military advantage but are also intended to threaten the very existence of the Ukrainian nation, which is evidenced by the deliberate targeting of critical infrastructure. In the early weeks of Russia’s full-scale invasion, most attacks were directed at military targets. However, when it became clear that full military success was unattainable due to the resistance of Ukraine’s defence forces and civilian population, Russia shifted to a tactic of ‘missile terror,’ launching strikes on civilian objects. These actions, prohibited under international humanitarian law, can be classified, at the very least, as war crimes. Missiles were deliberately fired at residential buildings, shopping malls, railway stations, seaports, etc. According to Ukraine’s General Prosecutor’s Office, the primary aim of these attacks on civilians and civilian infrastructure was to intimidate the population, create a state of ongoing tension within society, and pressure Ukrainian authorities into making territorial and political concessions to the Russian Federation. The Russian Federation’s long-term aim is the partial extermination of the Ukrainian nation by inflicting conditions of life intended to bring about physical destruction. Since the beginning of autumn 2022, Russia’s missile attacks have been primarily targeted at energy facilities, including thermal and hydroelectric power plants, substations, and power lines.

Such actions ahead and during the heating season aimed to destroy Ukraine’s economy and create difficult living conditions for its civilians. According to the Kyiv School of Economics, direct damage to Ukraine’s infrastructure—calculated with the replacement cost method—amounted to USD 144 billion as of March 2023. However, the actual damage is far greater, as the replacement cost method offers only a baseline estimate of the value needed to replace destroyed assets. It does not capture economic losses resulting from lost opportunities like job displacement, business reductions and closures, or the migration of the labour force and economically active population abroad. As World Bank President David Malpass stated, the projected cost of rebuilding the infrastructure destroyed in Ukraine as a result of Russian armed aggression amounts to approximately USD 350 billion as of the end of 2023. 

The study aims to examine and estimate the economic losses resulting from Russia’s attacks on Ukraine’s critical infrastructure, which is protected from targeting in armed conflicts, under international law. To achieve this aim, it is essential to provide an overview of critical infrastructure destroyed in missile attacks, evaluate the extent of the destruction, and identify the resulting economic losses and their impact on Ukraine’s civilian population. This analysis will demonstrate that the actions of the Russian Federation are deliberately designed to create life-threatening conditions targeting a specific national group, and as such they qualify as genocide under Article 6(c) of the Statute of the International Criminal Court.

Several methods are employed in the study. These are: an analytical method to identify damaged infrastructure, a synthesis method to summarize the data, a statistical method to collect, process, and analyse financial information on damage to critical infrastructure, and abstract-logical and generalization methods to organize the theoretical findings and draw conclusions.

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