The West’s self-interest includes rebuilding Ukraine

The rebuilding of a shattered Ukraine will be a monumental task. A joint assessment led by the World Bank estimates the cost at $411 billion over 10 years.

But the scope of the challenge must not obscure the immense strategic value of getting it right. Indeed, Western leaders should be framing this project as one from which their countries will benefit.

The war in Ukraine, while horrific, has also been a showcase for Ukraine’s whole-of-society approach to technology. It’s a major reason why Ukraine has consistently outperformed expectations on and off the battlefield. This innovative mindset could provide invaluable lessons to whoever partners with Kyiv to rebuild a nation ravaged by seventeen months of intense fighting.  

Moscow’s illegal war has caused a massive brain drain in Russia. But in Ukraine, a new vanguard of programmers, activists and entrepreneurs is helping Kyiv reengineer the state for the 21st century. It is setting up resilient energy grids, delivering health care to deal with physical and mental trauma, creating countermeasures to foreign propaganda and influence campaigns, and shoring up national cybersecurity, to name just a few examples. Ukraine’s experience of merging conventional and high-tech weapons with signals intelligence and algorithm-based warfare also is also giving it unrivaled insight into the emergent platform military era.

A robust rebuilding effort could also provide some strategic clarity for Ukrainians and all of their neighbors. Even if Ukraine ultimately fails to regain all the territory lost since 2014, its reemergence as a prosperous and secure advanced democracy, compared to its weakened, backward neighbor, would represent victory in itself. It may even breathe new life into pro-democracy movements within Russia.

Some Western politicians, including on the far-right wing of the Republican Party in America, are questioning the value of sending taxpayers’ money abroad to support a foreign country embroiled in conflict. Donor countries, led by the U.S., have already given Ukraine at least $180 billion in military, financial and humanitarian aid.

Meanwhile, some 1,900 Ukrainian cities and towns lie in ruins. Domestic telecom operators have lost 4,000 of their mobile base stations and more than 60,000 kilometers of fibre-optic cable. Half of the country’s power grid has been damaged or “totally destroyed,” says Ukraine’s infrastructure minister. And that was before the collapse of the Nova Kakhovka hydroelectric dam on June 6 due to suspected sabotage, an incident that left 1 million people without drinking water. Some 30 percent of the countryside is now littered with land mines and unexploded shells.

Reversing all this destruction will require financial creativity. Alongside a growing chorus of current and former Western officials, Kyiv argues that the roughly $350 billion in Russian assets seized under sanctions against Moscow should be liquidated to fund a “Marshall Plan for Ukraine.”

Despite the proposal’s obvious merits, there are drawbacks. This would be harnessed instantly by the Kremlin’s global propaganda machine as evidence of a Western-led, anti-Russia conspiracy. Moreover, it could set a dangerous precedent for states to appropriate rivals’ assets for geopolitical gain.

There are also other obstacles and risks. Wariness over Ukraine’s history of organized crime and corruption still lingers. Sensitive to Ukraine’s image among foreign donors, President Volodymyr Zelensky’s office has cracked down on graft, with some success. The country’s chief justice was arrested in May as part of a probe into senior Supreme Court officials, allegedly involving multi-million dollar bribes.

Further political reforms are needed to reassure foreign investors eyeing opportunities in what the Ukrainian Chamber of Commerce is describing as “the world’s largest construction site.” Many of them align with requirements for Ukraine to fulfill its ambitions to join the European Union.

There is also the challenge of simply processing all the incoming funds. “Historically, the largest amount of money we have been capable of working with was $6 billion a year in 2014,” Mustafa Nayyem, head of the Ukraine State Agency for Restoration and Infrastructure Development, cautioned in a recent interview.

More broadly, a rapid rebuilding effort for Ukraine may harden anti-Western resentments in the Global South. India’s foreign minister, Subrahmanyam Jaishankar, has criticized this as a paradigm where “Europe’s problems are the world’s problems but the world’s problems are not Europe’s problems.”

To offset this risk, liberal democracies must launch parallel outreach efforts in developing countries, focused on enabling democracy-agnostic improvements to service delivery that can unlock economic growth. Another option is to push for reforms to the UN Security Council that would make it more inclusive and reflective of emerging changes to the international balance of power.

Nevertheless, figuring out how to fund and facilitate Ukraine’s reconstruction is a puzzle that its allies must solve. Rebuilding the nation would afford a chance to learn war-time lessons on how to digitally re-shape key aspects of governance, without first having to endure the horrors of conflict themselves.

Kyle Hiebert is an independent analyst and contributing writer to the Centre for International Governance Innovation. He was formerly based in Cape Town and Johannesburg, South Africa, as the deputy editor of the Africa Conflict Monitor.