International Experience of Post-War Compensation Policy

Valerii Zhuk, Nataliia Zhuk and Yuliia Shenderivska
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Valerii Zhuk: "Institute of Agrarian Economics" National Scientific Centre, Kyiv, Ukraine
Nataliia Zhuk: "Institute of Agrarian Economics" National Scientific Centre, Kyiv, Ukraine
Yuliia Shenderivska: "Institute of Agrarian Economics" National Scientific Centre, Kyiv, Ukraine

Oblik i finansi, 2024, issue 2, 33-45

Abstract: Today, the government of Ukraine and international and domestic experts estimate the damage from the war in the hundreds of billions of US dollars. However, this is usually a summary assessment data. Object-specific expert evaluation has a single application and requires the development of specific mechanisms for its implementation. The essential basis for this is international experience. Therefore, the article aims to study international reactions to economic challenges caused by war and the generalization of international approaches to the definition and procedures for compensation of losses to enterprises of victim countries caused by armed aggression. The study results confirm the expediency of partially applying the practices of Kuwait to create a corresponding mechanism in Ukraine. The primary basis for financing compensation commissions for the payment of reparations to Ukraine, in particular, confiscated Russian assets and deductions from the aggressor's exports, has been determined. The need to develop low-cost damage assessment methods due to the limited possibilities of professional assessment (limited personnel, financial and time resources) is substantiated. The need for creating a simplified mechanism for recording and assessing losses, which will be available for use by a wide range of specialists and separate sectoral methods of assessing losses (agricultural sector, transport, etc.), was highlighted. The shortcomings of the damage and loss assessment methodology chosen by the Government of Ukraine are substantiated, including the lack of an opportunity to determine and demand compensation for indirect damages (forgotten profit). The hypothesis about the need for revisions and additions in the domestic policy of assessing losses and compensations for the consequences of war, in particular, in terms of focusing on an expert approach in assessment and judicial and arbitration practice of compensations, the introduction of an accounting approach to assessing losses, has been proven.

Keywords: loss compensation; loss assessment methodology; direct losses; lost profit; international experience; accounting approach; loss fixation mechanism; international arbitration; compensation commission; evidence (search for similar items in EconPapers)
JEL-codes: F39 F51 M40 M41 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:iaf:journl:y:2024:i:2:p:33-45

DOI: 10.33146/2307-9878-2024-2(104)-33-45

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