Attachments
Executive summary
● While the war in Ukraine is ongoing and its outcome yet unclear, the damage to its agriculture and agrifood sector is already of an unprecedented scale, both in terms of the impact on the national economy and on global food security.
● Reconstruction and rehabilitation plans for Ukrainian agriculture are urgently needed in order to mitigate the impact of the war domestically and internationally but their successful implementation will depend on the achievement of stable and long-lasting peace.
● Damage caused by war to a country with an agricultural output and exports as significant as that of Ukraine is unparalleled since the Second World War. Current damage to infrastructure is estimated in the range of USD 68-199 billion and the economy is expected to shrink by 40 percent in 2022.
● Reconstruction and rehabilitation costs of Ukrainian agriculture due to loss and damage resulting from the Russian aggression on the country will most likely exceed the similar estimated costs following the armed conflict in Syria, considering the complexity of its food system (including export infrastructure) and billions of USD in lost revenues from exports.
● Damages are defined as totally or partially destroyed physical assets and stocks, while losses are calculated in terms of forgone output and incomes as a result of the war.
● The total value of capital stock in Ukrainian agriculture (including down- and upstream sectors) is estimated at USD 29 billion. The potential direct damage to agriculture assets can initially be estimated at USD 6.4 billion (this includes destroyed irrigation infrastructure, storage, machinery and other agricultural equipment, in-port infrastructure, greenhouses, field crops, livestock and processing units).
● The additional expected economic losses from the war in 2022 are estimated at about USD 22 billion.
● FAO’s International Financial Institutions partners (World Bank, EBRD) have already pledged USD 3 and 2 billion respectively for recovery in Ukraine. However, it is clear that actual recovery and investment needs will be far higher in agriculture and the agrifood industry alone.
● Any agricultural investment/recovery plan will need to be a part of the national recovery strategy, and will need to be based on pre-disaster baseline, damage and loss assessments followed by an assessment of recovery investment needs. Tentative priority areas to be covered by a recovery and investment plan for Ukrainian agriculture will likely include support to rural households and food security, liquidity and access to finance, de-mining, critical inputs supply, seed production and livestock breeding, compensation for lost assets and other areas of immediate and long-term development needs.