At a breakfast discussion at Davos in January 2023, the BlackRock CEO Larry Fink said that Ukraine’s postwar recovery could become “a beacon to the rest of the world about the power of capitalism”. The scene could have been a parody of Russian propaganda: the head of an American asset firm telling a rapt crowd of the Western business and political elite that Ukraine’s reconstruction would not only be a cash cow but would be touted as a capitalist success story – presumably something to congratulate themselves about at future breakfasts in Davos. For Fink, Ukraine’s reconstruction presented not just a business opportunity but an ideological one. If Western political leaders saw the war in Ukraine as an occasion to reinvigorate EU and Nato enlargement, then Fink and his ilk viewed it as an opportunity to revive a waning faith in capitalism.
The idea sounds somehow familiar. Fink’s words reflect the continuation of a more than 30-year project adopted by – and in some ways, imposed on – Ukraine and its neighbours. The “disaster capitalism” of the current war was preceded by the administration of 1990s “shock therapy”, a series of radical neoliberal reforms following the fall of the Soviet Union, from which the country never fully recovered. The current war has introduced an innovation on the old formula: the fusion of neoliberal economic policies with cowboy advances in technology, particularly artificial intelligence (AI) and digitalisation. Wartime Ukraine has already seen a dramatic influx of Western donor funds, consultants, experts, engineers and Silicon Valley venture capital. The result has been radical experiments in the introduction of AI-enhanced platforms for mine clearance and the rapid collation of commercial satellite data (both supplied by Peter Thiel’s Palantir); and economic strategies like the “fast state”, a Ukrainian government proposal that envisions a state so streamlined that it “disappears in one’s own efficiency”.
Ukraine’s reconstruction will be an unimaginably daunting task. The World Bank recently assessed that it would cost close to $500bn. Beyond the staggering cost in human life, war has devastated the economy: in the first year of the conflict, the country lost between 30-35 per cent of its GDP. Poverty more than quadrupled and one in three families are now food insecure. Over 15 per cent of Ukraine’s territory – comprising some of the most fertile farmland on Earth – is now contaminated with landmines and unexploded ordnance...
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