Reconstruction - Joanna Kusiak, Oleksandr Kravchuk, Simon Johnson, Vladyslav Rashkovan, and Luke Cooper - Restitutions: Appropriation, Expropriation, Regulation

Restitutions: Appropriation, Expropriation, Regulation

Joanna Kusiak, Oleksandr Kravchuk, Simon Johnson, Vladyslav Rashkovan, and Luke Cooper

Photo: Vitya Glushchenko

September 2023

The expert panel and open roundtable “Restitutions: Appropriation, Expropriation, Regulation” was held on September 11, 2022 as part of the international symposium “The Reconstruction of Ukraine.” An edited transcript of the panel is below, and a transcript of the roundtable which followed will be published separately.

It may be a year since this panel and roundtable took place, but the dialogue has aged remarkably well, with the majority of these issues remaining “live” matters of discussion and, indeed, contestation. In contrast to the Cold War era, which was defined by several relatively hierarchical blocs (“East,” “West,” and “Non-Aligned”), the present phase of world order is highly fragmented, perhaps more so than the concept of “multipolarity” suggests. After all, rather than consolidating its “pole,” Russia’s full-scale invasion of Ukraine has massively weakened its regional and global position. Ukraine’s resistance has, by contrast, proven adept at utilizing the fragmented networks of the twenty-first century, but there remains a question over its material ability to “stay the course,” especially if a hostile candidate wins the 2024 US presidential election.

The remarks of Oleksandr Kravchuk, to whom this collection has been dedicated, highlight how the international financial institutions are in urgent need of progressive reform. Ukraine has forced, to some degree, pragmatic adaption of institutions. The IMF, for example, always has to be paid back and cannot constitutionally provide either aid or loans that it knows will not be repaid. This makes it poorly suited to supporting Ukraine’s funding needs. Ukraine’s IMF program could therefore be seen as a public relations exercise, for once the global lender of last resort gives its mark of approval to the country’s debt viability, the idea is others will follow. Kravchuk is also right in his suggestion that external debt sustainability is a question of the size and income of the working population. This poses an interconnected need of encouraging refugees back to Ukraine and creating well paid jobs, with robust systems of tax collection and enforcement.

The role of the public and private sector remains a live topic of debate, including at the June 2023 London Ukraine Recovery Conference (URC), where the “Kharkiv Masterplan” was one of the showcase presentations. To a certain degree, the realities of fighting a war have pushed the government of Ukraine away from its ideological preference for libertarianism and free markets. They have, for example, indicated strong support for a policy of “insourcing the recovery” through preferential reconstruction and development strategies. Speaking at the URC, Ukrainian Finance Minister Serhiy Marchenko argued emphatically in favor of such a national development strategy towards Ukrainian industry in the reconstruction process. “Traditionally, we were very welcome to any money. Now we are not. If you want to invest in Ukraine, you must accept the priorities of Ukraine.”1

There was, however, an implicit difference between such pragmatic policies towards reconstruction (also put forward, for example, in the speech of the Minister for Infrastructure, Oleksandr Kubrakov) and their medium to long-term thinking, which still asserts a strong ideological preference for “economic freedom,” including a radical shrinking of the state and sweeping deregulation. Still, political and economic reality—above all, the huge reconstruction and energy transition needs, and the very difficult risk environment for private sector investment—will likely favor those advocating for a state-led developmental strategy.

—Luke Cooper, September 11, 2023.

Joanna Kusiak: I approach the topic of restitution in two contexts. The first pertains to Poland. Warsaw was completely destroyed during the Second World War. Then, for reconstruction, the land was nationalized under the Socialist government. The reconstruction took place with public labor and public money. It was only after 1989, in the new political context, that discussions about this reconstruction and possible restitution to private, pre-war owners began. But because of the total character of post-war reconstruction, restitution remained a very controversial question and it was never legislated by the Parliament. What happened in Warsaw was that, in the end, restitution turned into a business of a small group of lawyers and businessmen who used the narrative of historical justice to dispossess public land in the city. We need to keep in mind that the notion of historical justice can sometimes cover different types of injustice imposed on the original injustice of the war.

In the other context, Syria, where the conflict is still ongoing, I am working together with the architect Ammar Azzouz. The political situation in Syria is by no means clear: it is very complicated in terms of different forces and stakeholders. What we are trying to pay attention to is the Assad regime’s use of housing, land, and property as a weapon. Property has become weaponized as a part of the war against Syrian rebels or independent Syrians. The property of Syrians who escaped the war is being taken over or dispossessed. New property rights are being imposed. More and more land in Syria is becoming owned by people closely associated with the Assad regime. Here lies the danger of using the simple legal frame of property for issues of restitution. If restitution proceeds by simply looking at property titles, we might reproduce injustice and benefit people who only got their property because of their close connection to the oppressor regime.

Any reconstruction demands an intervention on property. Legally speaking, even removing rubble is illegal without the owner’s permission. And there’s always the question of who pays for reconstruction and creates the new property system. Taken on an individual level, there is always the risk of speculating with property. After the war in Yugoslavia, for instance, there was success in saving the ethnic diversity of some places, but even if some ethnic groups kept their property titles, many ended up being forced to sell their property. Another way to attempt to keep social diversity and maintain a certain form of historical justice would be to derive inspiration from aboriginal land rights or indigenous peoples’ cases and try to secure land rights for particular groups rather than individuals.

Simon Johnson: Russia obviously owes compensation to Ukraine and Ukrainians for the enormous damage, loss of life, human suffering, displacement of families, and of course, the damage to property in its various forms, both private and socially owned infrastructure. This rests on a principle already established in the international community: there will be a large mass of compensation payable over many years. But how do you get Russia to pay?

Various ideas have been discussed, including using frozen Russian assets that are held outside of Russia. Some oligarchs’ properties could be applied towards these compensation claims. But I doubt that the G7 will want to immediately apply this approach to the Russian foreign exchange reserves held outside the country. Those will likely remain frozen for the foreseeable future, as they may be useful to dissuade Russia from future further violence.

The main site that we could focus on, which is being discussed at the level of countries and international organizations, is Russian energy exports. The current situation is unlike the Cold War when the Soviet Union operated within its own economic block. The entire modern part of the Russian economy has been focused on exports, primarily of fossil fuels. Russia’s number one export has been crude oil and refined products for decades. Number two has been natural gas, number three has been coal, and then on down the line, including grain.

The Russian leadership has considered—and this has been reflected in some of European reactions—that these exports of fossil fuels confer power on Russia. This comes from its ability to cut off natural gas supplies to Western Europe, potentially destabilize the oil market, and put some pressure on the coal market as well—which Russia has done. With the latest actions or announcements of the G7 and the movement towards imposing a price cap on Russian oil and refined products exports, Ukraine’s allies are starting to understand that Russia needs to export. Russia needs that revenue, which it is using to buy drones from Iran and artillery shells and other equipment from North Korea. Russia needs hard currency, cash. Without that cash, they would have difficulty maintaining the ruble’s stability, which would further contribute to their economic difficulties.

The question thus arises: how much Russian energy do countries want to buy? On what terms? If we can determine how the revenue flows to the selling country, as in the case of the Oil for Food program in Iraq in the 1990s, we could discuss how much of that revenue should go to the Russian state, and how much should go to a compensation fund that pays out to Ukrainians who’ve suffered horrendous losses.

Of course, Russia will say that’s their money, and it all should go to them. But what are they going to spend that money on? Let’s say that the fighting has stopped. How much free cash flow should the Russian state be allowed to have to support whatever they have in mind in terms of re-armament? Current G7 policy recognizes that the world needs Russian oil, in the short term. If all that oil will be withdrawn, the price of it will be higher and there will be economic consequences. But how much oil, gas, and coal do countries really want to buy from Russia? And how do they want that revenue to be divided?

If Russia would be open to selling oil and to splitting the revenue with the Ukrainians, against whom it has created these massive injustices, that could be a productive conversation. If Russia decides to close itself off and not sell anything to the world, that’s their decision. They will not, in that case, be buying from the world, and life in Russia will be significantly different than it has been over the past two decades. But these are choices they can make for themselves.

But the responsibility of the world, on the level of the G7, the European Union and other countries that are willing to participate in this conversation, is to really evaluate with people in Ukraine how much damage has been done, what needs to be done in terms of rebuilding, what is the just and appropriate level and distribution of compensation, and then to seek that compensation from Russia in terms of what we might call a “long-term lien” on their revenues that they generate from exporting fossil fuels to the world.

Vladyslav Rashkovan: Speaking about the political economy of Russia’s war against Ukraine and following reconstruction, we need to split the timeline into several stages. My system for doing this is “eight Rs and one M.” The duration of these stages is difficult to predict: some of them are subsequent to each other, others overlap in time. The understanding of this periodization is necessary, however, since different stages of reconstruction, and later, reparations, are associated with different political players, political arrangements, instruments, and their prioritization. It is also important to understand how Russia will compensate Ukraine for all the damage it has caused.

First: Reanimation. The invasion brought about the massive destruction of critical infrastructure. We have seen the fastest-growing refugee crisis since the Second World War, the collapse of international trade routes due to the blockade of the Ukrainian ports by Russia, and energy shortages in Ukraine. The combination of all these war factors compressed in a very short period of time could have brought lethal consequences to Ukrainian sovereignty. But Ukraine stands, not only due to Ukrainian bravery, the Ukrainian army, and the wisdom of its leadership, but also due to the help of international institutions. In March 2022 alone, a total of around €3.5 billion was came to Ukraine from the IMF, World Bank, European Investment Bank, EU, and US. This is unprecedentedly fast. Without this reanimation given by international partners, discussions about reconstruction would probably not be possible.

The next stage is Rehabilitation. All those millions of people who fled their homes to neighboring countries and even further, to the US and Canada, have received a lot of support from the hosting states. The European Union provided temporary protection schemes which assume residency rights, access to the labor market, housing, social welfare, medical assistance, and means of subsistence. All of this helped because it took a bit of pressure off the Ukrainian budget.

Next, the Ukrainian state needed Relief. And it came in July 2022 from the official creditors of Ukraine, from the Paris Club, who announced the intention to suspend principal interest payments for Ukrainian bilateral debts, which continues until today.2 Private creditors also supported debt relief as well. According to some estimations, all of this could save Ukraine around $15–20 billion in the next few years, which could also be spent on Ukrainian reconstruction. Sanctions against Russia don’t provide direct relief for Ukraine, but they do reduce Russia’s war chest. Therefore, they help Ukraine to fight this war.

The fourth R stands for Recovery, which is where we are now. Ukraine is still short on resources, but we already need to reconstruct the liberated cities and prepare them for winter, which is coming. There is the question of how to reconstruct during ongoing military actions, but in parallel the economy also needs to be relaunched and restarted. We need to not forget that the Ukrainian people are a labor force and also consumers. And having five million people abroad puts a lot of strain on the future potential growth of Ukraine.

I hope that the Restart stage will also come with Resilience. The Ukrainian government will implement the new economic policies, work to improve the rule of law, and fight corruption and monopolies, which were an obstacle for the growth of Ukraine before the war.

The seventh R, the Return of people to Ukraine, also raises the task of Reconciliation among different internal groups. We need to reconcile a lot, internally between those who stayed in Kyiv or Irpin during the hottest battles, the heroes, and those who fled the country. We need to discuss it. Also, when we liberate cities like Kherson, the people who stayed there, selling food in the shops, for example, are they collaborators or victims or hostages of the war? We have to go through this painful dialogue within the country. At the same time, I don’t believe in reconciliation with Russia. Maybe during the next few decades, but it will be very difficult, whoever the leader there will be.

While the time for large-scale reconstruction is still to come, planning for it should be done now. But when it does, Modernization will come, which is not only about the reconstruction of the country’s infrastructure. We need to talk about adapting a new social contract for society, developing a new social fabric.

Oleksandr Kravchuk: As of September 2022, Ukraine has suffered losses of almost $300 billion in the destruction of infrastructure, housing, and businesses. It will take decades to restore all of this. That’s why we are very grateful for all the help from Western partners, especially if it happens on a non-repayable basis.

However, let us imagine Ukraine when the war is over and the reconstruction is underway. What country are we fighting for? What will Ukraine’s economic policy look like? How will we live without the remnants of our Soviet heritage, like the heavy industry that was destroyed under bombs in Donbas? What opportunities are there for Ukraine to become a player in the world market?

Only after we regain our economic sovereignty can we distribute resources for our aims. We have to get rid of our external debt. Today it amounts to $60 billion, half of which belongs to international financial institutions like the IMF and the World Bank.

On July 1, following four months of the Russian invasion and after eight years of war with Russia, the World Bank still didn’t recognize us as a country at war.3 This means that the World Bank gave us loans according to standard regulations, like a middle-income country. I find it difficult to define this as anything other than profiting from war.

As for the scale of the debt, in 2021, interest payments made up 9% of Ukraine’s state budget. This was the largest share of any single expenditure category, even exceeding the total spending on national defense. We can see the consequences today on the front line.

In September 2022, every citizen of Ukraine owed 63,000 UAH (approximately $3,000 USD) to foreign creditors.4 Meanwhile, the minimum monthly salary in Ukraine hasn’t grown anywhere nearly as fast as the debt. Even before the war, state- and state-granted debt per capita amounts to ten minimum salaries in Ukraine.

In these circumstances, it is difficult to find resources for development. For almost thirty years, Ukraine has lived under the pressure of foreign creditors. They provide us with support for so-called social and economic reforms, but this led to privatization and the implementation of other neoliberal policies. We privatized our strategic industries with this money, and we have almost abandoned our social support system, reorienting our priorities towards the export of raw materials, and so on. The current Russian blockade of our ports show how precarious this position is for Ukraine.

Today, the war gives us a chance to put an end to this mess. The Ukrainian authorities should stop playing the role of good borrowers. Instead, however, they are implementing austerity measures on doctors and teachers.5 It is time for Ukraine’s foreign debt to be written off. We have many reasons for this: corrupted elites, injustice, and a lack of alternatives. Let’s be honest: Ukraine will not be able to pay all its debt. This means we are heading towards a default. So, the only question is: on what terms will the cancellation or the reconstruction of this debt be made?

It is important not to fall into the trap of 2015, when creditors dictated all the conditions of restructuring. Is it possible to deal without new loans? The government should stop sending Ukrainian resources offshore. It should design a just taxation system and finally transfer to a socially responsible economy. On top of this, however, we need to cancel Ukraine’s foreign debt. An international campaign to do this has already started, and it can contribute to a wider discussion about neocolonial relations between the core and periphery of the global economy. What roadmap can be developed, and what kind of pressure can be put on western governments to make these steps real?


Plenary 2, Scale of the Recovery Challenge, Ukraine Recovery Conference, .


Jones, Marc. “Ukraine to Come Up with New Debt Relief Plan Early Next Year.” Reuters. June 21, 2023. See .


This has changed in 2023. See .


“People around the world demand IMF to cancel Ukraine’s unjust debt.” openPetition. February, 2020. See .


Farbar, Kateryna. “The cost of war leaves Ukraine struggling to pay its teachers.” Open Democracy. April 6, 2023. See .

Reconstruction is a project by e-flux Architecture drawing from and elaborating on “The Reconstruction of Ukraine: Ruination, Representation, Solidarity,” a symposium held on September 9–11, 2022 organized by Sofia Dyak, Marta Kuzma, and Michał Murawski, which brought together the Center for Urban History, Lviv; Center for Urban Studies, Kyiv; Kyiv National University of Construction and Architecture; Re-Start Ukraine; University College London; Urban Forms Center, Kharkiv; Yale University; and Visual Culture Research Center, Kyiv.

Economy, Architecture, War & Conflict
Ukraine, Politics
Return to Reconstruction

This panel took place as part of the symposium “The Reconstruction of Ukraine: Ruination / Representation / Solidarity,” on September 11, 2022.

Joanna Kusiak is a scholar-activist who works at the University of Cambridge.

Oleksandr Kravchuk was a left-wing economist, author, and lead editor of the Ukrainian media platform Spilne/Commons. Kravchuk passed away on July 21, 2023 in Kyiv.

Simon Johnson is the Ronald A. Kurtz (1954) Professor of Entrepreneurship at the MIT Sloan School of Management, where he is head of the Global Economics and Management group.

Vladyslav Rashkovan is an Alternative Executive Director at the IMF, representing Ukraine and 14 other states on the Executive Board.

Luke Cooper is Associate Professorial Research Fellow in International Relations at the London School of Economics and Political Science and Director of PeaceRep’s Ukraine program.


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