USSR: ECONOMIC IMPACT OF THE CHERNOBYL' ACCIDENT

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 06795976
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 7
• Document Creation Date: April 23, 2025
• Document Release Date: March 25, 2025
• Case Number: F-2016-02406
• Publication Date: May 23, 1986

Approved for Release: 2025/03/17 C06795976
Directorate of
Intelligence
(b)(3)
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
International
Economic & Energy Weekly
23 May 1986
iii Synopsis
1 Perspective�USSR: Facing Hard Currency Shortages
3
USSR: Economic Impact of the Chernobyl' Accident
Chernobyl Task Force, SOVA
7 Central American Core Four: Troubled Small Debtors
11 India: Pace of Economic Liberalization Slows
15 French and Japanese Industrial Policy: Diverging Impacts on the Electronics
Industry
19 Briefs Energy
International Finance
Global and Regional Developments
National Developments
Indicators
Comments and queries regarding this publication are welcome. They may be
directed to Directorate of Intelligence,
DI 1EEW 86-021
23 May 1986
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
International
Economic & Energy Weekly
Synopsis
Perspective�USSR: Facing Hard Currency Shortages
Low energy prices, domestic oil production problems, and a depreciating dollar
will substantially reduce the Soviets' ability to import Western equipment,
agricultural goods, and industrial materials for the rest of the decade. This
comes at a time when General Secretary Gorbachev may have been counting
on increased inputs from the West to assist his program of economic
revitalization.
3 USSR: Economic Impact of the Chernobyl' Accident
Preliminary analysis of the Chernobyl' nuclear accident indicates that direct
damage to the Soviet economy will be relatively minor. Nonetheless, the
potential loss of electric power this year could put a crimp in General
Secrets Gorbachev's hopes to get the new five-year plan off to a fast start in
1986.
7 Central American Core Four Troubled Small Debtors
The external debts of the Central American Core Four countries�Costa Rica,
El Salvador, Guatemala, and Honduras�are small, but the burden of
repayment weighs heavily on their equally small economies.
11 India: Pace of Economic Liberalization Slows
Prime Minister Gandhi, prompted by a growing trade deficit, a tight budget,
and domestic political problems, has moved to slow the pace of economic
liberalization. Gandhi is modifying his approach to protect the country's hard
currency reserves and deny his opposition a rallying point and will look
increasingly to Western governments for financial support.
15 French and Japanese Industrial Policy: Diverging Impacts on the Electronics
Industry
Although both the Japanese and French electronics industries have been
nurtured by a wide range of government policies, the Japanese industry has
emerged as a world leader while the French industry has failed to make a
major impact on the global electronics market. Japan, in our judgment, will
build upon its current strengths, while continuing French lags in electronics
may lead Paris to tighten protection for the sector, including calls for higher
EC tariffs on electronics products.
UI
rIElet
1 EW 86-021
23 May 1986
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
(b)(3)
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
USSR: Economic Impact of
the Chernobyl' Accident
Preliminary analysis of the Chernobyl' nuclear
accident indicates that direct damage to the Soviet
economy will be relatively minor. Although the cost
of the evacuation, decontamination, cleanup, im-
ports of technical equipment and medical supplies,
and some permanent resettlement will be large�
perhaps as much as 25 billion rubles according to
preliminary estimates I
I-direct damage to
agriculture, industrial facilities, and the environ-
ment will be limited to a fairly small area. None-
theless, the potential loss of electric power this year
could put a crimp in General Secretary Gorba-
chev's hopes to get the new five-year plan off to a
fast start in 1986.F-7
The Human Costs
Preliminary calculations suggest workers and fire-
men at the reactor site and local residents who were
drawn to the area by the fire�perhaps as many as
200 to 300 persons�received potentially lethal
doses of radiation. As of 21 May, the death toll was
15-13 from radiation and two from the explosion.
Additional deaths among the heavily irradiated
victims are expected in the next several weeks.
Onlookers near the site would have inhaled consid-
erable airborne radioactivity and may be among
the hospitalized victims, who, according to Gorba-
chev, numbered 299 on 14 May. People within 5
kilometers (km) of the site who were exposed to the
initial radioactive plume could have received sub-
stantial doses of radiation. An additional 25,000 to
30,000 persons who were exposed may have re-
ceived enough radiation to show mild symptoms
such as nausea, and these people will be at risk for
future cancers
(b)(3)
The accident also forced a large-scale relocation of
many in the area. As of 13 May, Moscow acknowl-
edged that 92,000 persons had been evacuated from
3
a 30-km zone around the plant. We estimate the
population of this area to be 150,000 to 180,000,
including the two towns of Pripyat' and Chernobyl'
and the surrounding rural population. It is likely
that many fled on foot�some with their live-
stock�before vehicles arrived. In addition to the
official evacuees, thousands of persons, mostly
women and children, have left Kiev and other cities
outside the 30-km area.
It is difficult to estimate the cost of the evacuation,
but assuming military units were involved, little
incremental cost would accrue to the Soviets. Vol-
unteers are housing many of the evacuees; and, if
existing housing is properly decontaminated, resi-
dents could begin returning within months. The
Soviets reportedly are applying a polymer to the
immediate area that can later be removed, taking
contamination with it. The roofs of buildings are
also being coated to prevent rain from washing
radioactive debris into drainage systems. It is likely
that permanent relocation will be required for some
of the population. Indeed, in some areas, the evacu-
ees are already being put to work.
Impact on Agriculture
The initial plume of radioactivity appears to have
passed over an area covered largely by forests and
swamps. Not more than 15 to 25 percent of the
crop and pasture land in the Chernobyl' region
would have been seriously affected. Soviet data
show that the region accounts for a minuscule share
of total Ukrainian farm output. Damage to farming
regions beyond the immediate area of the accident
is likely to be minimal. Because harmful levels of
contamination are localized, we do not anticipate
substantial, long-term effects on international com-
modity supplies or trade
1 1EEW 86-021
23 May 1986
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
What Happened in Chernobyl'?
Our best estimate of the cause of the accident is
that the reactor power suddenly surged, producing
superheated steam. A reaction between superheat-
ed steam and zirconium-alloy fuel cladding pro-
duced hydrogen gas. The gas built up until it
exploded, damaging the reactor and leading to fuel
melting and a fire in the graphite. The destruction
of the reactor hall allowed large quantities of
radioactivity to escape. The explosion reportedly
knocked out the radiation alarm system, and
officials at the site did not learn of the high levels
of radioactivity until hours later. Two and possibly
three persons were killed by the explosion, and at
least 35 people at the site, including some of the
firemen who responded, were exposed to lethal
doses of radiation. Helicopters were used to drop
sand, lead beads, clay, dolomite, and boron into
the burning reactor. The fire was finally extin-
guished on 11-12 May.
The livestock sector may be more seriously disrupt-
ed in the area. Indeed, we have already seen reports
of livestock being slaughtered because of high
radiation levels. Soviet press reports
however, indicate many livestock were evacuated
along with the population. Livestock that ingested
contaminated feed before being evacuated should
survive if quickly switched to clean feed. Except for
milking cows, radioactive isotopes not excreted by
these animals would be localized in organs general-
ly not consumed by humans, such as the thyroid,
and in bones. Some pastureland beyond the evacu-
ated area may have to be taken out of use until
radiation drops to acceptable levels, putting pres-
sure on local supplies of stored feed.
The local dairy industry will be most seriously
affected because cows consuming radioactive feed
concentrate radioiodine�the main contaminant�
in their milk. Cows fed contaminated feed will
produce hazardous milk for several weeks after
switching to clean feed. Soviet dairy authorities will
have to not only monitor the milk but also assure
that condemned milk does not reach black-market
channels.
4ret
Local Effects of Radiation on Agriculture
The effects on farming activities near the site are
likely to be varied. Although the affected area
contains very small quantities of grain and sugar-
beets, winter grains planted last fall and sugar-
beets that are just emerging have been exposed to
radioactive particles settling on leaves. Some of
this radiation will be incorporated into the plants.
Lightly contaminated grain may be mixed with
clean grain during milling to dilute any harmful
effects, but any heavily contaminated grain will
have to be collected and disposed of Sugarbeets
exposed to radiation would tend to concentrate
radioactivity in their roots and will likely have to
be destroyed.
According to US experts, spring grains and vegeta-
bles can be planted in areas of light contamination
because most of these crops�with the exception of
sunfiowers�do not absorb radiation through their
roots. Danger to humans, however, could result
from contaminated dust raised by machinery in
fields during planting, subsequent field operations,
and harvesting. Thorough monitoring and decon-
tamination of workers, equipment, and crops in the
areas adjacent to the evacuated zone will be
necessary, slowing field work. Even in those areas
where contamination is light, crops could suffer
some losses if normal spring field operations are
delayed. Workers may be kept from the fields as a
safety precaution or diverted to cleanup opera-
tions. Growing seasons in the USSR are short, and
harvests are frequently disrupted by the early
onset of winter
The Chernobyl' power plant is located just north of
the Kiev Reservoir, which supplies the bulk of the
drinking water for the Ukraine's capital. Some
radiation was undoubtedly carried to the reservoir
4
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
by winds and by the two major rivers feeding it�
the Pripyat' and the Dnepr. Fish, particularly
freshwater shellfish, taken from these waters will
also require monitoring for some time. The Soviets
are building a 30-meter concrete wall into the
ground around the complex to contain any contam-
inated runoff or groundwater seepage. Soviet envi-
ronmental authorities, however, maintain that reg-
ular water samples are being taken from the Kiev
Reservoir and that they show levels of radioactivity
below established norms.
(b)(3)
Local Industry
An inventory of industrial facilities within the 30-
km zone around the reactor reveals only a small
number of civilian plants, including two concrete
products plants, a machine-tool plant, perhaps 10
food-processing sites, three textile mills, and a
railroad repair yard. I _ _ Iseveral
of these facilities have been shut down�probably
as a result of the evacuation order. How long they
will be affected remains an open question, depend-
ing on the degree of contamination and how quickly
the Soviets want to resume their operation. Moscow
has already discussed bringing reactor units 1 and
2 at Chernobyl' back on line as quickly as possible,
but local industry may not have such a high
priority.
In all likelihood, the accident disrupted�at least
temporarily�electricity supplies beyond the 30-km
area. All industries suffer problems in the event of
brownouts or blackouts, but the largest users of
energy�metals processing, cement, food process-
ing, and chemicals�would be hardest hit from
resulting damage to machinery and products in
process. We have no information to date regarding
specific disruptions in electric power supplies to
local industry. In addition to electricity, industrial
facilities depend on water for cooling and process-
ing. If irradiated water is used in processing, some
end products could be affected, particularly in the
chemical and food sectors.
5
Electricity Supplies
The shutdown of the four 1,000-megawatt (MW)
reactors at Chernobyl' will probably have a wide
range of effects. During the summer lull in electric-
ity demand, the Soviets will be able to compensate
for most of the power losses associated with Cher-
nobyl' by using other generating capacity more
intensively. Beginning in September, however, the
upsurge in demand for electricity probably will
eliminate most of the painless adjustment mecha-
nisms. Moreover, we have good evidence that two
reactors at Kursk identical to the damaged one at
Chernobyl' may not now be operational. We cannot
be certain whether these other reactors are com-
pletely shut down or are operating at reduced
power levels for safety reasons. Moreover, if they
are in fact shut down, it is unclear that the
Chernobyl' accident was the reason. Moscow, how-
ever, probably would not disrupt the economy
further by shutting down the remaining nine
graphite-moderated, boiling-water reactors
(RBMK) similar to those at Chernobyl' unless the
cause of accident is judged to have stemmed from
basic design faults.
The confirmed shutdowns at Chernobyl' and the
likely shutdowns at Kursk�assuming the latter
reactors remain out of service for the remainder of
the year and the power is not made up from other
plants�would reduce Soviet electricity output in
1986 by about 25 billion kilowatt-hours (kWh),
roughly 1.5 percent of the annual total. The im-
pact, however, is concentrated on two power grids
that would experience losses of about 10 percent.
Power cuts of this magnitude, although unlikely,
could seriously affect key economic activity in the
Ukraine and Moscow regions. We believe the Sovi-
ets will attempt to ease the impact by drawing
electricity from adjoining grids, and possibly from
more distant grids in the Urals and Kazakhstan.
Moscow may also request that Czechoslovakia,
Bulgaria, Romania, and Poland reduce imports of
electricity from the Ukraine�roughly 20 billion
Approved for Release: 2025/03/17 C06795976
Approved for Release: 2025/03/17 C06795976
kWh was sent to these countries in 1985. Cutting
exports to Eastern Europe, however, may not be a
politically attractive way to ease the crunch.
(b)(3)
The Soviets could compensate for the loss of elec-
tricity over the next several months if they forgo
maintenance�normally scheduled for the sum-
mer�at power plants using fossil fuels and operate
them at full winter capacities. Moscow has already
reported that one generating unit at a thermal
power plant in Kiev, normally held in reserve at this
time of the year, is now operating at full capacity to
partially compensate for the loss of Chernobyl'.
Seven other power plants in the Ukraine�four
hydroelectric and three thermal�are also reported
to be working at full capacity.
Increasing output at conventional plants, however,
is only a stopgap measure. Maintenance must still
be performed, and if it is not finished by winter the
Soviets will be hard pressed to meet the surge in
electricity demand that will take place then. In any
event, domestic supplies of fossil fuels will have to
be supplemented with increases in domestic fuel
production and possibly with imports, such as
additional coal from Poland. The additional fuel
required to offset the loss of the Chernobyl' reac-
tors would amount to perhaps 150,000 barrels per
day oil equivalent and half again as much if the �
other two reactors remain shut down. If domestic
fuel oil supplies are used to generate replacement
electricity for these six reactors, at the expense of
exports of oil to the West, hard currency losses
would amount to $100 million per month at current
prices.
The Chernobyl' disaster is likely to result in some
setback to the USSR's nuclear power program. The
Soviets currently have 28,300 MW of nuclear
generating capacity, supplying some 11 percent of
their electricity. Moscow's plans call for expansion
of nuclear capacity to 70,000 MW by 1990, boost-
ing the nuclear share of total electricity output to
more than 20 percent. The accident may prompt
14'et
the Soviets to at least put construction of new
RBMK reactors on hold temporarily. The Soviet
decision to allow placement of nuclear plants closer
to populated areas to supply centralized district
heating systems�including one in Kiev�could be
reexamined.
6
Approved for Release: 2025/03/17 C06795976