Ukraine’s Economy Minister Warns of $45 Million-per-Hour Cost from Intensifying Missile Alerts

Missile alerts are costing Ukraine an estimated $45 million per hour in halted business operations, the country’s economy minister has warned, as Kyiv struggles to maintain economic stability amid intensifying Russian bombardment. Oleksandr Kravchenko, minister for economy and the environment, said Russia has increasingly targeted the infrastructure underpinning Ukraine’s economy, striking industrial sites, warehouses, logistics hubs and data centres in an effort to destroy the nation’s economic base. What was not fully anticipated, he added, was how quickly Russia has developed jet-powered drones to target virtually everything, pounding Kyiv in recent weeks.

Speaking from a heavily protected government building in Kyiv, Kravchenko – a former McKinsey executive who joined the government over the summer – explained that attacks are forcing large parts of the economy into repeated standstills as workers are sent to shelters. With sirens sounding up to 10 hours a day, he noted: “If people are in a bunker, business stops.”

To mitigate the economic impact, the government recently introduced a two-tier warning system designed to keep businesses operating during prolonged air raid alerts. A “red” alert warns of a missile threat and requires people to seek shelter, while a “yellow” warning is used for drone threats, allowing many businesses to remain open. More than half of businesses were continuing to operate during yellow alerts, Kravchenko said. However, a yellow alert is no guarantee of safety. That danger was brought into sharp focus on Monday, when a Russian jet-powered drone struck the National Academy of Sciences in central Kyiv during a yellow alert, killing two people who were still inside working.

The situation underscores the difficult trade-offs Ukraine faces as it tries to keep normal life moving while protecting people from an escalating campaign of Russian strikes. Russia’s attacks this year alone have caused an estimated $10 billion in damage to fixed assets, targeting steel plants, warehouses, logistics infrastructure and, most recently, data centres. Russia has also effectively blockaded Ukraine’s Black Sea ports, which previously carried the bulk of the country’s exports.

Kravchenko believed the government was better prepared for what could be the “hardest, the harshest winter” of the war, with further pressure expected on energy supplies, infrastructure and businesses already weakened by months of strikes. To protect against future attacks, the government is discussing ways to allow more private companies to purchase Ukraine’s air-defence system, though he cautioned that businesses could never fully protect themselves from Russian missiles and drones.

The ongoing damage from strikes has added to an already severe strain on the state’s finances. President Volodymyr Zelenskyy has put Ukraine’s remaining budget shortfall this year at about $27 billion, a figure that has prompted questions among some European governments over how the gap emerged, despite the EU having already agreed a €90 billion loan package covering 2026 and 2027. Kravchenko said the government had since narrowed the shortfall to $20 billion through spending cuts and by identifying additional domestic reserves. Kyiv is now seeking further support from the EU, Japan, Canada and the UK, including potentially bringing forward loans earmarked for next year.

“There is very active work with all our international partners to get additional sources of funding,” he said. High-profile corruption scandals have also reached Zelenskyy’s inner circle, straining trust in the government both at home and among western donors. A recent poll by the Kyiv International Institute of Sociology found that corruption in government was the most cited concern among Ukrainians, named by 50% of respondents, ahead of mass missile and drone strikes at 40%. The same survey found that 72% believed Zelenskyy bore personal responsibility for corrupt actions by people around him.

Kravchenko said progress had been made to tackle the issue but admitted that Ukraine faces both corruption itself and a persistent perception problem both inside Ukraine and abroad. “I very much appreciate the pressure of European partners on reforms,” he said, adding that Ukraine also needed to tackle perceptions of corruption at home and abroad. Ukraine’s external financing needs for 2027 are estimated at $52.6 billion, but only about $20 billion has so far been secured, according to the minister, with further tax rises and spending cuts under discussion.

Asked whether the rise of parties sceptical of support for Ukraine in France and Germany could weaken western commitment to Kyiv, he said: “Am I worried? I think I should be, probably.” “The overall fatigue is increasing in Europe,” he added.

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