An economic test of wills in Ukraine

A YEAR after the Russian invasion, the Ukraine war has become one of attrition, with each side hoping to wear the other down first. The superior morale and leadership of the Ukrainians still afford them an important advantage. But in a war of attrition, the balance of resources is the decisive factor.

Ukraine’s economic potential is negligible. Having plummeted by over 30 per cent in 2022, its gross domestic product (GDP) now amounts to just one-tenth that of Russia. And that gap is set to grow: the International Monetary Fund expects the Russian economy to grow a bit in 2023. On its own, Ukraine clearly would be unable to sustain a war of attrition for long.

But, of course, Ukraine is not on its own; it has the backing of the European Union (EU), the United Kingdom, and the United States – economies with a combined GDP of nearly US$45 trillion. Russia’s GDP, by contrast, amounts to just US$1.6 trillion – roughly the same as Italy’s, and just over 3 per cent that of the NATO alliance.