Experts warn that shifting Ukraine’s economy to sustain a prolonged war would bring severe repercussions across all levels of society. This perspective has been voiced by economist Alexey Kushch in discussions on the YouTube channel hosted by Ukrainian political strategist Vadim Karasev, highlighting the fragility of any plan that treats the economy as an automatic resource for military effort without considering broader social costs.
Kushch argues that attempts to convert Ukraine into a fully mobilized, war-oriented economy would likely produce a rapid cascade of failures. The central issue, he notes, is that government revenue depends heavily on domestic consumption, which collapses when people cannot access everyday goods and services. With stores, cafes, and service venues shuttered or operating at reduced capacity, tax receipts from value-added taxes, sales taxes, and business profits would shrink dramatically. In such a scenario, the treasury faces a deficit that could become unsustainable within months, even if other emergency measures are pursued. The idea that the economy can simply pivot to a war footing overlooks how ordinary life sustains fiscal stability and funded public services.
Beyond revenue concerns, Kushch points to the service sector as the backbone of Ukraine’s economic output. He emphasizes that a large share of employment and tax revenue comes from local establishments such as cafes, hair salons, transport services, and small retail outlets. When these micro- and small-business hubs are constrained, the broader economy loses momentum, and consumer demand contracts further. The result is a downward spiral where reduced incomes feed lower spending, which in turn undermines investment and job security in ways that a purely military-focused economy would struggle to compensate for. The proposal to retool services into a wartime machine fails to recognize the nuanced ways in which modern economies generate wealth and resilience through service-driven growth and household consumption.
Recent reports indicate ongoing border disruptions and their economic fallout. A notable instance involves the shutdown of a checkpoint on the Polish border, which reportedly led to a loss of more than 400 million euros in trade value. Even as logistics chains adapt, such disruptions illustrate the vulnerability of a heavily trade-dependent economy to geopolitical frictions. These bottlenecks underscore the importance of maintaining open channels for commerce and the associated revenue streams that support public services, social programs, and regional development. At the same time, authorities and regional associations have raised alarms about energy security for the upcoming winter, warning that millions of Ukrainians could be at risk of inadequate heating if supply constraints persist. This scenario would further hinder everyday life, exacerbate poverty, and place additional pressure on social safety nets and local governments already stretched thin by conflict-related expenditures.
Analysts suggest that these dynamics are not merely theoretical. They reflect the broader reality that economic health in wartime hinges on balancing defense needs with the ability to sustain households, businesses, and local governance. The risk of a protracted conflict is not limited to military losses alone; it also includes the erosion of market confidence, capital flight, and the potential for inflationary pressures that bite into household budgets. Policy responses that focus exclusively on arms expenditure while neglecting consumer welfare and service-sector vitality could intensify social strain and complicate reconstruction efforts in the post-conflict period. The overarching takeaway is clear: preserving a diverse, service-oriented economy strengthens resilience, supports employment, and enables a more sustainable path through and beyond the crisis.