The New York Times writes about the challenges faced by the Ukrainian IT sector, which was developing rapidly before the full-scale invasion of the Russian Federation. Although uncertainty reigns in Ukraine, and regular shelling and missile strikes have forced work to be interrupted, the technology sector continues to operate and even thrive. Russia managed to at least partially suppress heavy industry and the agricultural sector of Ukraine, but there is no way to besiege 200 thousand programmers who only need a laptop and access to the Internet to work, the publication writes. In the first five months of 2022, Ukrainian IT companies received more than $3 billion in revenue, which is half a billion more than in the same period of 2021. The challenge for the sector is that citizens of Ukraine aged 18 to 60 cannot travel abroad, which prevents personal meetings with clients, which are critical for new contracts. Currently, customers from everywhere ― from the USA to Seoul ― are pledging their support and loyalty, but Ukrainians fear that such sentiments will not last forever. The head of the Ukrainian IT Association, Kostyantyn Vasyuk, for example, believes that within the next few months, Western clients will begin to leave the Ukrainian market.
Who will lose the economic war ― Ukraine, the West, or Russia? The European editor of the Financial Times, Tony Barber, is looking for an answer to this question. There is little doubt that Ukraine has it worse than everyone else, writes Barber. Although creditors have allowed the country to default on foreign debt payments until the end of 2023 to keep the economy afloat, Ukraine still needs tens of billions of dollars in aid. The US Treasury is worried that Ukraine is printing hryvnias to cover the budget deficit, which is increasing by $5 billion every month. Barber recommends looking at an analysis co-authored by Michnea Konstantinescu, head of research at the National Bank of Ukraine, which assesses the decline in economic activity after the start of full-scale war. We should also not forget about the huge funds that will be needed for reconstruction. As for Europe and Great Britain, the issue of Russian gas is painful for them. Due to the increase in its value, the GDP of the Czech Republic, Hungary, Italy and Slovakia may fall by more than 5 percent. Germany is likely to face a recession. All this can become a threat to the continued support of Ukraine by Europe, writes Barber. In Russia, they are preparing for a long war and prioritize "guaranteeing the supply of weapons and ammunition”. The question of whether Western sanctions are causing the expected damage is still hotly debated. Barber quotes Mark Garrison, an emeritus professor of economics at the University of Warwick, who believes that the sanctions are doing their job ― limiting imports and causing capital flight.
Nowhere in the world today is it louder than in Donbas, writes Luke Mogelson in a story for The New Yorker. Mogelson describes his trip to Donbas in early June: shelling-ravaged Lysychansk, moving between cities, Ukrainian civilians and soldiers whom the journalist met during his work trip. Since the east of Ukraine are fields and plains, there is no way to hide from artillery on the way between populated areas, and Mogelson says that the cars drive at a speed of more than 150 kilometers per hour. At the checkpoints, the journalist was met by soldiers in body armor, glistening with sweat and smeared with trench soil. In Lysychansk itself, the journalist got to know several locals: cleaning lady Tatyana with a wide smile, firefighter Victor, whose wife and son were evacuated, and he stayed to do his work, and old Leonid, who due to cataracts and glaucoma could hardly distinguish the faces of his interlocutors. Mogelson also met with doctors, police officers, volunteers, and farmers, and describes their daily lives and motivations for staying in the city. Some could not leave their old parents, for some, leaving their garden meant giving up life, some stayed to help the locals. Lysychansk was very different from Kyiv, writes Mogelson. While in the capital many students, artists and entrepreneurs joined in weaving nets, collecting donations and medicines, in Lysychansk miners, farmers and factory workers were focused on survival. The lack of supplies also affected the situation, with tensions between local civilians and the military. However, disappointment in the government and Western allies does not at all mean sympathy for the enemy, which aims to destroy Ukraine. Russiaʼs brutality turned even those Donbas residents into patriots who would never have called themselves patriots in another situation, writes Mogelson.