Ukraine's economy minister says each hour of air raid alert costs the country about $45 million

Why it matters

Kravchenko's estimate puts a dollar figure on the everyday economic cost of Russia's air campaign against Ukraine, beyond direct damage to infrastructure. It also marks a government policy shift: the two-tier alert system is an attempt to limit business shutdowns during lower-threat drone alerts, even as attacks on industrial and logistics sites continue. The figures underscore both the scale of the financing gap Ukraine faces and Kyiv's reliance on Western partners — the EU, Japan, Canada and the UK — to bridge it.

What happened

In an interview with The Guardian, Ukraine's Economy Minister Oleksandr Kravchenko said each hour of air raid alert costs Ukraine about $45 million because businesses are forced to stop operations. He said Russian attacks on metallurgy plants, warehouses, logistics centres and data centres have caused more than $10 billion in damage since the start of 2026, and characterised the strikes as an attempt to "destroy practically the entire economy." Air raid alerts, he added, can last up to 10 hours a day.

Kravchenko described Ukraine's recently introduced two-tier alert system: a "yellow" level signalling a drone threat, under which more than half of enterprises continue to operate, and a "red" level signalling a missile threat, which requires shutdowns. He cautioned that the "yellow" level does not guarantee safety, citing a Russian jet-powered drone strike on the National Academy of Sciences building in central Kyiv during a yellow alert that killed two people inside.

The minister said businesses cannot fully protect themselves from Russian attacks and that the government is discussing allowing more private air defence companies to purchase air defence systems. He said Russia's effective blockade of Ukraine's Black Sea ports has cut off a major export route, and that Ukraine is counting on additional support from the EU, Japan, Canada and the UK, including possible early disbursement of loans planned for next year. Kravchenko attributed the 2026 budget deficit — reduced from $27 billion to $20 billion through spending cuts — to lower-than-expected revenues and rising war costs rather than mismanagement.

Background

Air raid alerts in Ukraine can last up to 10 hours per day, forcing workers into shelters and businesses to halt operations. On 2 September, President Volodymyr Zelensky announced that Ukraine would update its alert system and introduce two threat levels — yellow and red; differentiated alerts began in Kyiv on 6 September under a Cabinet of Ministers decision. The "yellow" level signals a drone threat and allows businesses to keep operating under safety conditions, while the "red" level signals a missile threat and requires shutdowns.

The Ukrainian Council of Shopping Centers reported that in August 2026 air alerts accounted for 21.8% of shopping-mall operating hours — up from 19.9% in July — with malls losing an average of 6.4 full working days that month and cumulative forced downtime since the start of the full-scale invasion exceeding 166 working days. The Retailers Association of Ukraine said the Auchan network logged more than 4,000 hours of downtime in 2025.

Kravchenko said Ukraine did not fully anticipate how quickly Russia would develop jet-powered drones and deploy them in attacks, and that such a drone struck the National Academy of Sciences building in central Kyiv during a yellow alert, killing two people inside. He said the 2026 budget deficit was driven by lower-than-expected revenues and rising war costs rather than mismanagement or corruption, and noted it had been reduced from $27 billion to $20 billion through spending cuts and additional domestic resources. Ukraine's external financing need for 2027 is put at $52.6 billion, with only about $20 billion currently confirmed. Russia has effectively blocked Ukraine's Black Sea ports that previously handled the bulk of Ukrainian exports.