How Putin Has Already Weakened Ukraines Economy – The New York Times
KYIV, Ukraine Pavlo Kaliuk, a freelance property broker in Ukraines capital, used to sell and rent properties to clients from the United States, France, Germany and Israel. Then in November, when Russia first began posting troops along the countrys border, the deals quickly dried up.
In Kyiv, if you are talking about apartments which are medium level or higher, most deals are on pause because we are really not sure what will happen tomorrow, said Mr. Kaliuk, 34.
Ukraine, which has been at war with Russia since 2014, is once again in a state of fearful suspended animation. The United States estimates that a combined 190,000 Russian troops and Moscow-backed secessionists are encircling the country and inside separatist-held territory as President Biden and other Western leaders warn that an invasion or attack could happen any day and leave tens of thousands of people wounded or killed.
Without outright declaring war or taking action that would trigger the harsh sanctions promised by the West, Russias president, Vladimir V. Putin, has once again succeeded in destabilizing Ukraine and making clear that Russia could wreck the countrys economy. The evacuation announced last week of American, British and Canadian citizens has led to panic. Several international airlines have stopped flights into the country. Russian naval exercises in the Black Sea have exposed the vulnerability of Ukraines critical ports for commercial shipping.
As for real estate?
The number of requests is fewer and fewer every day, Mr. Kaliuk said.
The anxiety coursing through Kyiv is exactly what Mr. Putin hopes to achieve, according to Pavlo Kukhta, an adviser to Ukraines minister of energy. What they want to do is the equivalent of winning the war without firing a single bullet, by causing massive panic here, Mr. Kukhta said.
Timofiy Mylovanov, president of the Kyiv School of Economics and a former minister of economic development, said his institution has estimated that the crisis has already cost Ukraine several billion dollars, just in the past few weeks. War or a long siege would only worsen the situation.
You either get an invasion or your economy hurts, he said.
The first major blow came Monday when two Ukrainian airlines said they were unable to acquire insurance for their flights, forcing Ukraines government to create a $592 million insurance fund to keep planes flying. On Feb. 11, London-based insurers had warned aviation companies that they would be unable to insure flights to Ukraine or those flying above its airspace.
KLM Airlines, a Dutch company, responded by saying it would halt flights. Many Dutch passengers were onboard Malaysia Airlines flight MH17 when it was shot down above territory controlled by pro-Moscow rebels in 2014. The German airline Lufthansa said it was suspending flights to Kyiv and Odessa starting Monday.
On Tuesday, Ukraine was subjected to a massive cyberattack, as hackers flooded the servers hosting websites until the servers became overloaded and shut down. Officials blamed Russia, though the Kremlin denied involvement. Still, Ukraine officials said it was the largest distributed denial-of-service attack in the countrys history and targeted government ministries and state banks.
They want people to start running on the banks, added Mr. Kukhta. The war is a hybrid the Russians are playing in several domains, the economy included.
Earlier in the week, Irina Gorovaya and other entrepreneurs in Kyiv organized a Stay In Ukraine campaign to try to rally people behind local businesses that are being hit by the economic upheaval. Ms. Gorovaya, the chief executive of Mozgi Group, a creative agency, said festivals and other events were losing money rapidly because people are too hesitant to buy tickets.
People are sitting at home thinking about what will come tomorrow, she said.
On Ukraines southern coastline, the arrival of the Russian Navy to conduct exercises in the Black Sea has been another reminder of Ukraines vulnerability, both militarily and economically, since in the event of war the countrys critical ports could face a blockade. So far, Russia has allowed a corridor to remain open for commercial shipping, and there have been no disruptions to operations at Ukrainian ports.
Feb. 24, 2022, 6:00 p.m. ET
We dont have any guarantees, but for now were operating normally, said Aleksandr Mukhin, who works in the development office at the port in Mykolaiv, in southern Ukraine.
On a visit to the port this week, the sweet, burned smell of sunflower oil, one of Ukraines primary exports, hung in the air. The oil was being pumped through a series of pipes into a bright red Italian vessel, the Saracena. Ukraine exports about 300,000 tons of sunflower oil a year.
During World War II, the port was the scene of fierce fighting; a portion of it has still not been repaired from the heavy bombing that occurred when Soviet forces fought to retake it from the Nazis.
The port of Odessa, the countrys largest oil and gas terminal and a major hub for grain exports, is also considered a possible target, especially given the significant sympathy in the city for pro-Russian separatists in 2014. Some military analysts have warned that Russia might try to take Odessa if the military invades.
But even without an all out blockade or attack, the ports can still be hobbled by fear of risk among international insurers. Londons marine insurance market on Tuesday listed the Russian and Ukrainian waters in the Black Sea and the Sea of Azov as high risk, making it more expensive to ship goods to and from the ports. This will add more economic pressure to Ukraine, which relies on its Black Sea ports to export grain.
A retired U.S. Army lieutenant general, Ben Hodges, recently compared the Russian land and naval forces encircling like country to a boa constrictor around Ukraine, choking its economy and further threatening its sovereignty.
What is at the root of this invasion? Russia considers Ukraine within its natural sphere of influence, and it has grown unnerved at Ukraines closeness with the West and the prospect that the country might join NATO or the European Union. While Ukraine is part of neither, it receives financial and military aid from the United States and Europe.
Are these tensions just starting now? Antagonism between the two nations has been simmeringsince 2014, when the Russian military crossed into Ukrainian territory, after an uprising in Ukraine replaced their Russia-friendly president with a pro-Western government. Then, Russia annexed Crimeaand inspired a separatist movement in the east.A cease-fire was negotiated in 2015, but fighting has continued.
How has Ukraine responded? On Feb. 23, Ukraine declared a 30-day state of emergencyas cyberattacks knocked out government institutions. Following the beginning of the attacks, Volodymyr Zelensky, Ukraines president, declared martial law. The foreign minister called the attacks a full-scale invasion and called on the world to stop Putin.
The Kremlin aims to make Ukraine a failed state, which they believe they can achieve by applying constant pressure, he posted on Twitter, without actually launching a new offensive.
But the American response to the crisis has also infuriated some people, whether by creating panic with alarmist warnings of an imminent invasion or the decision to evacuate some embassy staff from Kyiv and set up a temporary office in the western city of Lviv, close to the border with Poland.
When someone decides to move the embassy to Lviv, they must understand that such news will cost the Ukrainian economy several hundred million dollars, David Arakhamia, the leader of the governing Servant of the Peoples Party, said in a television interview, adding: Every day we count the losses of the economy. We cant borrow in foreign markets because the rates there are crazy. Many exporters refuse us.
Olena Bilan, the chief economist of Dragon Capital, an investment firm, said Ukraines economy had been expected to grow by almost 4 percent this year, but the military crisis has shaved that prediction by almost half.
Even so, Ms. Bilan said, Ukraine is far better prepared economically than when Russian aggression began in 2014. Its foreign currency reserves are at historic highs, and it has largely decoupled its economy from Russia, aside from imports of oil and coking coal for the steel industry.
Ukraine is also preparing to separate itself from the Russian power grid, said Mr. Kukhta, and financial assistance from the European Union and the United States is helping to reassure investors and worried insurance companies.
We live in such conditions which are not so stable for eight years already, said Mr. Kaliuk, the real estate agent. Ive gotten used to it and try to be flexible.
Today, Mr. Kaliuk said, only one group of foreign investors seem unperturbed Belarusians trying to escape from the strongman rule of Aleksandr G. Lukashenko, one of Mr. Putins closest allies.
Ukraine is the borderland between the free world and the world of dictatorship, Mr. Kaliuk said. We are lucky we are on the good side of the border. This is our fate, to protect our own freedoms and have solidarity with the free world. After thinking for a moment, he added that it was not luck; that it had been paid for with the blood of those who died in the 2014 uprising that drove a Moscow-backed government from Kyiv and of the 14,000 people who have died in the ensuing war. We have to fight for it, Mr. Kaliuk said.
Michael Schwirtzcontributed reporting from Mykolaiv.
Link:
How Putin Has Already Weakened Ukraines Economy - The New York Times
- Trump News Updates: Epstein, Tariffs and Ukraine War - The New York Times - July 28th, 2025 [July 28th, 2025]
- Russia at the gates: How Ukraine defended a strategic city for months - Reuters - July 28th, 2025 [July 28th, 2025]
- Trump Gives Russia Less Than Two Weeks to End Its War in Ukraine - The New York Times - July 28th, 2025 [July 28th, 2025]
- Trump says hes shortening the 50-day deadline for Russia to end the war in Ukraine - AP News - July 28th, 2025 [July 28th, 2025]
- Russia's sinking fake ships with exploding naval drones. The training likely isn't for war with Ukraine. - Business Insider - July 28th, 2025 [July 28th, 2025]
- I already know the answer Trump to shorten Ukraine deadline for Putin to 1012 days - The Kyiv Independent - July 28th, 2025 [July 28th, 2025]
- Ukraine war briefing: attack on Kyiv injures eight, Trump and Starmer to discuss applying pressure on Putin - The Guardian - July 28th, 2025 [July 28th, 2025]
- Trump gives Putin new 10 or 12 days deadline to end war in Ukraine - politico.eu - July 28th, 2025 [July 28th, 2025]
- Trump reduces Russia deadline to end Ukraine invasion to 10 to 12 days from original 50: No reason to wait that long - New York Post - July 28th, 2025 [July 28th, 2025]
- Brutality over precision What the Army is learning from Russia in Ukraine - Task & Purpose - July 28th, 2025 [July 28th, 2025]
- E.U. Cuts Aid to Ukraine Over Corruption Concerns - The New York Times - July 28th, 2025 [July 28th, 2025]
- Five killed as Ukraine and Russia trade drone attacks - BBC - July 28th, 2025 [July 28th, 2025]
- Russia's economy is now so militarized, it may keep expanding its army even after the Ukraine war - Business Insider - July 28th, 2025 [July 28th, 2025]
- Trump issues new ultimatum calling on Putin to end Ukraine war in '10 or 12 days' - France 24 - July 28th, 2025 [July 28th, 2025]
- Ukraine, Russia attack each other's territory after latest round of peace talks - Reuters - July 28th, 2025 [July 28th, 2025]
- That idiot Putin wants to take it all: Russias kamikaze tactics fuel a slow advance in Ukraine - The Guardian - July 28th, 2025 [July 28th, 2025]
- Trump gives Putin 10 to 12 days to agree Ukraine ceasefire - The Telegraph - July 28th, 2025 [July 28th, 2025]
- Ukraine war briefing: Drones hit Russian electronic warfare plant and disrupt railway and air travel - The Guardian - July 28th, 2025 [July 28th, 2025]
- Binge, borrow and deal: Europe digs deep to buy U.S. arms for Ukraine - The Washington Post - July 27th, 2025 [July 27th, 2025]
- Putin may be miscalculating Trumps resolve on Ukraine - Atlantic Council - July 27th, 2025 [July 27th, 2025]
- Ukraine is now an indispensable security partner for the US and Europe - Atlantic Council - July 27th, 2025 [July 27th, 2025]
- Russia says it has captured two villages in Ukraine, Ukraine reports heavy fighting - Reuters - July 27th, 2025 [July 27th, 2025]
- Battles of the mind: drawing Ukraine in this endless war | Ella Baron - The Guardian - July 27th, 2025 [July 27th, 2025]
- Zelenskyys Anti-Corruption Climbdown: What It Means For Ukraine - Radio Free Europe/Radio Liberty - July 27th, 2025 [July 27th, 2025]
- School-leavers losing their lives for Russia in Putin's war with Ukraine - BBC - July 27th, 2025 [July 27th, 2025]
- Ukraine war briefing: Anti-corruption agencies endorse bill restoring their independence - The Guardian - July 27th, 2025 [July 27th, 2025]
- Five killed after Russia and Ukraine trade aerial bombardments - Sky News - July 27th, 2025 [July 27th, 2025]
- 4 people killed, multiple others injured in Russia and Ukraine as they trade aerial attacks - AP News - July 27th, 2025 [July 27th, 2025]
- Russia, Ukraine truce talks overshadowed by new fighting - Vatican News - July 27th, 2025 [July 27th, 2025]
- What China really wants for Russia and Ukraine - The Hill - July 27th, 2025 [July 27th, 2025]
- North Koreas military is being transformed on the battlefields of Ukraine so why is Seoul silent? - The Guardian - July 24th, 2025 [July 24th, 2025]
- State Department OKs $322 million in proposed weapons sales to Ukraine - Military Times - July 24th, 2025 [July 24th, 2025]
- Israel, Ukraine To Hold Talks On Countering "Threats" Posed By Iran - NDTV - July 24th, 2025 [July 24th, 2025]
- In Kyiv, Saar announces Israel-Ukraine strategic dialogue on Iranian threat - The Times of Israel - July 24th, 2025 [July 24th, 2025]
- Ukraine sees first major anti-government protests since start of war, as Zelensky moves to weaken anti-corruption agencies - CNN - July 24th, 2025 [July 24th, 2025]
- Zelenskyy faces outcry after signing a bill curbing Ukraine's anti-corruption agencies - NPR - July 24th, 2025 [July 24th, 2025]
- Russia and Ukraine to Renew Talks, but Peace Remains Elusive - The New York Times - July 24th, 2025 [July 24th, 2025]
- Russia and Ukraine Met Again. Heres Where the Peace Talks Stand - The New York Times - July 24th, 2025 [July 24th, 2025]
- Ukraine and Russia agree to new prisoner swap during brief peace talks - France 24 - July 24th, 2025 [July 24th, 2025]
- Kremlin says Putin open to peace with Ukraine only after Russias goals have been achieved - PBS - July 24th, 2025 [July 24th, 2025]
- Russia and Ukraine agree prisoner swap, but little other progress in Istanbul talks - CNN - July 24th, 2025 [July 24th, 2025]
- Bucks County man died a Ukraine war hero. He is not the only American on the frontlines - PhillyBurbs - July 24th, 2025 [July 24th, 2025]
- Russia and Ukraine Are No Closer to Peace After Trumps Threats - WSJ - The Wall Street Journal - July 24th, 2025 [July 24th, 2025]
- Zelensky Faces Criticism in Ukraine Over Effort to Rein In Corruption Agencies - The New York Times - July 24th, 2025 [July 24th, 2025]
- Swarms of Russian drones attack Ukraine nightly as Moscow puts new emphasis on the deadly weapon - AP News - July 24th, 2025 [July 24th, 2025]
- Outrage in Ukraine as the government attacks anti-corruption watchdogs - The Economist - July 24th, 2025 [July 24th, 2025]
- The Ukraine war will shape the world - Financial Times - July 24th, 2025 [July 24th, 2025]
- US Approves $322 Million Military Aid Package for Ukraine, Including HAWK Air Defense and Bradley Vehicles - UNITED24 Media - July 24th, 2025 [July 24th, 2025]
- Wartime Protests in Ukraine Target Zelensky for the First Time - The New York Times - July 24th, 2025 [July 24th, 2025]
- Zelensky: Ukraine and Russia to hold peace talks on Wednesday - BBC - July 24th, 2025 [July 24th, 2025]
- Faint Signs of Life Appear in Effort to Halt Ukraine War - The New York Times - July 24th, 2025 [July 24th, 2025]
- The Air Battle That Could Decide the Russia-Ukraine War - foreignpolicy.com - July 24th, 2025 [July 24th, 2025]
- Ukraine backlash grows after Zelensky strips anti-corruption bodies of independence - BBC - July 24th, 2025 [July 24th, 2025]
- Ukraine, Russia hold third round of peace talks in Istanbul, agree to another major prisoner exchange - The Kyiv Independent - July 24th, 2025 [July 24th, 2025]
- Ukraine-Russia war latest: Prisoners of war return to Kyiv after Istanbul peace talks end in less than an hour - The Independent - July 24th, 2025 [July 24th, 2025]
- Trumps Name in the Epstein Files, and Rare Protests in Ukraine - The New York Times - July 24th, 2025 [July 24th, 2025]
- Saar begins diplomatic visit to Ukraine, expected to meet Zelensky - The Times of Israel - July 22nd, 2025 [July 22nd, 2025]
- Zelenskiy says Ukraine, Russia to hold peace talks in Turkey on Wednesday - Reuters - July 22nd, 2025 [July 22nd, 2025]
- Russia launches 42 drone strikes on Ukraine overnight, hours after agreeing to Istanbul peace talks - as it happened - The Guardian - July 22nd, 2025 [July 22nd, 2025]
- US and Germany agree to deliver five Patriot air defence systems to Ukraine, Berlin says - Euronews.com - July 22nd, 2025 [July 22nd, 2025]
- Trumps shift on Ukraine has been dramatic but will it change the war? | Rajan Menon - The Guardian - July 22nd, 2025 [July 22nd, 2025]
- Putin stalls. Trump changes his mind. Ukraine targets Moscow. Latest on the war. - USA Today - July 22nd, 2025 [July 22nd, 2025]
- Preparations to deliver Patriot missile systems to Ukraine under way, Natos top Europe commander says as it happened - The Guardian - July 22nd, 2025 [July 22nd, 2025]
- Swarms of Russian drones attack Ukraine nightly as Moscow puts new emphasis on the deadly weapon - ABC News - July 22nd, 2025 [July 22nd, 2025]
- Why Putin keeps making the same Ukraine mistakes - Lowy Institute - July 22nd, 2025 [July 22nd, 2025]
- Ukraine Ups Its Arms Production, Asking Allies to Pay for It - The New York Times - July 22nd, 2025 [July 22nd, 2025]
- Ukraine Scrambling To Fight Against Growing Russian Shahed-136 Threat - The War Zone - July 22nd, 2025 [July 22nd, 2025]
- Jewish funders must refocus on Ukraine before its too late - eJewishPhilanthropy - July 22nd, 2025 [July 22nd, 2025]
- Zelenskyy renews offer to meet with Putin as officials say Russian attacks kill a child in Ukraine - AP News - July 22nd, 2025 [July 22nd, 2025]
- Ukraine, Russia to resume peace negotiations hosted by Turkey - Yahoo Home - July 22nd, 2025 [July 22nd, 2025]
- Ukraine war briefing: Russia insists on sticking to its war demands amid Trump sanctions threat - The Guardian - July 22nd, 2025 [July 22nd, 2025]
- Kremlin says Putin is ready to discuss peace in Ukraine but wants to achieve goals - Reuters - July 22nd, 2025 [July 22nd, 2025]
- Russia says it favours new round of peace talks with Ukraine, highlights gulf between them - Reuters - July 22nd, 2025 [July 22nd, 2025]
- Army deep dive into Russian tactics in Ukraine says global conflict with West will persist - Stars and Stripes - July 22nd, 2025 [July 22nd, 2025]
- Why Russia Is Gaining Ground in Ukraine - The New York Times - July 22nd, 2025 [July 22nd, 2025]
- Ukraine Has a Self-Inflicted Handicap in Its War for Survival - Bloomberg.com - July 22nd, 2025 [July 22nd, 2025]
- EU Warns Ukraine Over New Law That Could Undermine Anti-Corruption Agencies - united24media.com - July 22nd, 2025 [July 22nd, 2025]
- Ukraine offers Russia new peace talks next week - NBC News - July 20th, 2025 [July 20th, 2025]
- This is what Ukraine could do with US Tomahawk missiles - The Kyiv Independent - July 20th, 2025 [July 20th, 2025]
- Why are mentally ill soldiers being drafted in Ukraine? - dw.com - July 20th, 2025 [July 20th, 2025]