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The Latest on Russia’s War With Ukraine

Where Things Stand

Russia’s invasion of Ukraine officially began on February 24, 2022 and has caused great devastation but has been met with great defiance and resilience by the Ukrainian government and people.  The Ukrainian fight for freedom is inspiring and has turned the tide on the much-reported “decline of democracy” globally.

  • Over 15M Ukrainians out of a 45M total population are displaced, half of whom have left the country and half of whom have relocated from their homes.
  • Russia’s stated goals have changed as the war evolves. Today it appears a genocide is underway as Russia has conducted over 16,000 missile strikes of which 97% targeted civilian facilities.   The destruction of the economy and wearing down the civilian population are critical elements of its strategy.
  • Take agriculture alone, which supports 20% of the Ukrainian labor force and 11% of the country’s GDP. Over 160K square kilometers of farmland has been mined and is currently unusable – an area roughly the size of the state of Wisconsin in a country a little smaller than Texas.  Fields have also been burned, silos and storage bombed.  Exports via sea have been blocked by Russia with the exception of one corridor where to date some 12 million metric tons have been exported, as compared to 48 million metric tons in the previous year.
  • Ukrainian grain exports feed 400M people outside of Ukraine, and 70M of those are now at risk for famine from this disruption.
  • 50% of the power sector has been damaged with some 300 energy facilities destroyed. The entire country is now struggling with maintaining electricity, heat and water supply during an increasingly cold winter.  The effect of continued bombings will include not only humanitarian disaster, but increased outflow of refugees  seeking heat and safety.
  • The WHO has documented 703 attacks on the Ukraine’s health infrastructure since the Russian invasion had started, and operations now routinely occur by candlelight.

What is Needed Next

As President Zelensky raised with President Biden and in his address to the U.S. Congress on December 22, Ukraine needs continued support from the United States, the European Union, G7 partners, multilateral financial institutions, and others in the form of:

  1. Military, financial, and urgent reconstruction support to sustain Ukraine until it prevails over the Russian military and restores its territorial integrity.
  • Air defense and longer-range weaponry are critical to maintain the Ukrainian offensive that continues to liberate previously occupied territories.
  • Financial support to close the $3 billion per month budgetary gap that sustains civil servant salaries in areas such as healthcare and education, as well as pensions and financial support to the over 7 million temporarily displaced people within the country. To date, the Government of Ukraine has been able to maintain and deliver key government services and this needs to continue.
  • The past month of targeted shelling of power, heating and water infrastructure has brought the need for power spare parts, generators, power banks and other urgent support to keep the population of Ukraine from freezing this winter. The US has announced an immediate package of over $100 million in energy security support on an emergency basis.
  • By mid-October, close to $100B USD had been pledged to Ukraine from governments around the world and international financial institutions, with a large slice of that in the form of military aid and weapons. $54B was committed by the United States alone, although this is small compared to its total $800B national security budget.
  • Russia now holds some 15% of Ukrainian territory, down from 27% at its peak.
  1. Continued economic sanctions on Russia
  • The IMF estimated that the Russian economy could shrink as much as 6% by the end of the year, putting tremendous pressure on Russian leadership to justify their spending and focus on war with Ukraine.
  • Sanctions must be broadened and deepened to have a more immediate effect on the Russian economy, including more Russian (and Belarussian) banks, a lower price cap on oil, secondary sanctions on those countries not currently abiding by the sanctions.
  • Designating Russia as state sponsor of terrorism, as the EU Parliament and multiple European governments have done in the past months, is critical to stopping the flow of capital to Russia – used to finance this illegal and unprovoked invasion.
  • Western businesses that remain and continue doing business in Russia need to adopt and implement stronger ESG principles and cease all operations, cease contributing tax funding to the war and cease providing employees to the Russian conscription effort.
  1. Commitment to the reconstruction and renewal of Ukraine to begin the process of attracting public and private capital, provide confidence to the Ukrainian population and government, and ensure we are ready to act in a timely fashion
  • There may be need for close to $1T USD when all is said and done to rebuild and renew Ukraine, but this is low in comparison to the $3T that the United States alone spent on the war in Afghanistan and $2T on war in Iraq.
  • The quicker the war can be brought to an end, the quicker the reconstruction of Ukraine can begin, and the quicker Ukraine can get back on its own feet and off of foreign assistance. There will be enormous opportunity to rebuild Ukraine with new technology so that it can recover more quickly.
  • Despite multiple conferences and announcements, a coordinating mechanism is yet to be formed to bring bilateral and multilateral donors together in a way that will ensure coordination, transparency, urgency of response and avoid duplication. The General Marshall Fund of the US (GMFUS) has outlined how such a plan could be implemented with US-EU partnership and G7 support.  Agreement on a coordination mechanism is needed now to begin this process.
  • Real commitments should be announced by major bilateral and international partners exhibiting a long-term view and creating bipartisan commitment to the renewal and recovery post-war.
  • Western governments and international financial institutions should also begin now on the creation of the mechanisms most needed to attract the private sector to the renewal of Ukraine’s economy, e.g. concessional finance pools, military risk insurance, etc.
  • Legislation is required in countries that have frozen Russian state or oligarch funds to enable the funds to be confiscated and utilized for the rebuilding effort. Due process will make the process long and tedious, so the process of building the legal methodology needs to begin now.
  • A durable peace requires immediate cessation of Russian occupation of nuclear facilities and use of nuclear threats, opening of all ports and resumption of free trade, cessation of targeting of electricity and heating infrastructure, restoration of territorial integrity per the UN charter/removal of Russian troops and mercenaries from Ukraine’s territory, a cessation of hostilities, return of all military and civilian POWs, enforcement of justice (per the UN General Assembly resolution) for all those who have suffered at the hands of this war, restoration of the ecological balance (including demining), prevention of further escalation (Kyiv Security Compact) with appropriate security guarantees for Ukraine, and finally confirmation of peace via a written agreement.

How companies and individuals can be most helpful:

  • Advocating to their elected officials for continued government support for Ukraine, including military, financial, energy and reconstruction funding, as well as increased sanctions against Russia and Belarus to reduce monies available for the financing of this illegal war.
  • Ceasing all business in Russia/boycotting those companies that remain in Russia providing the Russian government financing via taxes and soldiers via conscription.
  • Donating to organizations working inside Ukraine and providing humanitarian relief:

Book a private consultation with Natalie Jaresko using the link below to learn more about the ongoing risks of this conflict to your organization, as well as how you can play a constructive role in the resolution of the conflict and Ukraine’s recovery.

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