Reconstruction in regions and communities: how losses are calculated

Since the beginning of the full-scale invasion, ambitious plans and grandiose recovery strategies have been discussed at international fora, world summits and expert conferences. However, it is important to understand that the beginning of this long and difficult journey begins at the local level – in regions and communities.

It is hard to imagine how reconstruction can start from ruins when you look howbuildings and entire cities have been destroyed. However, it is important to realise that we now face an equally important challenge – not just to rebuild, but to restore, strengthen and improve.

We have analysed the reconstruction processes in the regions and communities of Ukraine that suffered damage from the full-scale invasion. In doing so, we have identified key steps, strategies and innovations that are driving positive change at the local level and laying the foundation for the country’s recovery as a whole.

Damage to regions and communities

Assessing the damage caused to regions and communities during the full-scale invasion is a key task for understanding the extent of the war’s impact on the country and its reconstruction. All aspects of this issue should be carefully analysed to ensure effective recovery and sustainable development in the future.

The extent of the destruction in some areas is difficult to assess, as intense shelling and fighting continues in some regions of Ukraine. Residential buildings, administrative structures, industrial facilities, roads and bridges have been targeted in devastating attacks, and in some places even entire villages or towns have been almost completely destroyed. International experience shows that countries that have experienced large-scale destruction are rarely able to accurately estimate how many resources are needed to restore normal life in the country.

As of June 2023, the amount of direct damage to Ukraine’s infrastructure exceeded $150 billion, of which $55.9 billion was the loss of housing stock. At the same time, the World Bank estimated the total cost of reconstruction in March this year at $411 billion.

According to the updated data of the order of the Ministry of Reintegration, as of August 2023, more than 2,000 territorial communities and settlements were affected by active hostilities or occupation. As of March 2023, about 1.3 million households in Ukraine were destroyed or damaged.

The amount of direct damage caused by the explosion of the Kakhovka hydroelectric power station accounts for at least $2 billion. Of this, about $950 million relates to housing, while the rest is due to losses in the housing and utilities sector, energy, agriculture, transport, environment and industry. Preliminary estimates suggest that about 20-30,000 houses in the Kherson region and more than 500 private houses in the Mykolaiv region are in the flood zone.

In terms of damage assessment, there are currently initiatives and projects that record damage, develop calculation forms, approaches to assessment, and more. This issue falls within the competence of various actors, such as public authorities, CSOs, private organisations, and international partners. However, different methodologies result in different amounts of damage assessment. In addition, there are other objective difficulties in the calculations: the process of restoring critical infrastructure has already begun, and there is a risk of re-destruction of repaired buildings.

In many settlements, reconstruction work began almost immediately after they were liberated or the front line was pulled back. As of August 2023, 14,879 damaged or destroyed buildings were recorded in Kyiv, Mykolaiv, Sumy, Kharkiv and Chernihiv regions, of which 3,274 are undergoing restoration/reconstruction.

In some regions, local authorities are attempting to assess the damage, but this is only possible where there is no fighting. For example, as of May 2022, the Lviv regional authorities estimated the damage caused by Russian missile attacks at UAH 1.5 billion. At the state level, information about the destruction is collected through the Diia electronic system, which is then used to pay compensation.

Thus, there is a lack of a unified approach to calculating damages and, accordingly, assessing the overall resource needs for the reconstruction of Ukraine. However, the registration of damage allows for targeted restoration and reconstruction of damaged facilities by estimating the cost of projects during planning and implementation. In this context, it is important to systematise information about the objects being restored and the degree of their completion. This will help to avoid duplication of projects and simplify the search for co-financing for those that need to be completed.

The material was prepared with the support of the International Renaissance Foundation within the framework of the project “Fast track analytics for transparent and accountable reconstruction”. The material reflects the position of the authors and does not necessarily coincide with the position of the International Renaissance Foundation.