IRIA News

European Commission announced more than $850 million (€800 million) for Ukraine on June 21, 2023, to mobilize private investment for the recovery and reconstruction of the country.

According to the European Commission statement, at the sidelines of the Ukraine Recovery Conference 2023 in London, “Executive Vice-President of the European Commission Valdis Dombrovskis, together with the President of the European Investment Bank (EIB), Werner Hoyer, the President of the European Bank for Reconstruction and Development (EBRD), Odile Renaud-Basso, and the Managing Director of the International Finance Corporation (IFC), Makhtar Diop, signed agreements worth over €800 million to mobilize private investment for the recovery and reconstruction of Ukraine’s economy.”

The statement highlighted that President of the European Commission Ursula von der Leyen also presented the details of a new proposal for the Ukraine Facility that, “if adopted by the European Parliament and Council of the EU, will mobilize up to €50 billion over four years in the form of both grants and loans.”

These agreements will facilitate the involvement of the private sector in Ukraine’s efforts for recovery and reconstruction. The European Commission aims to enable the mobilization of funds for war insurance and offer guarantees that mitigate financial risks for the Ukrainian private sector, including small companies, agri-businesses, and women-led enterprises.

The European Commission outlined five agreements to finance the recovery of Ukraine’s economy, energy, and municipal infrastructure.

1. EU4Business Guarantee for Micro, Small, and Medium-Sized Enterprises: In a significant stride towards supporting economic growth, the Commission would provide €40 million with the European Investment Bank in EU guarantees, including €30 million for Ukraine that will unlock €375 million in loans for small and micro-entrepreneurs.
   
2. Facility for SMEs – Deep and Comprehensive Free Trade Area (DCFTA): As part of the EU’s continuous efforts to bolster the growth of small and medium-sized enterprises (SMEs), an additional €125 million in new loans will be facilitated for Ukrainian SMEs through local banks.
   
3. Fast Recovery Loans – EU for Ukraine (EU4U) Initiative: Recognizing the urgent need for recovery and repairs to municipal and energy infrastructure, the EU, in collaboration with the EIB, would allocate €100 million for Ukraine in sovereign loans.
   
4. Small Loan Guarantee Program: In a partnership between the EU and the International Finance Corporation, up to €200 million in financing would be allocated from Ukraine’s financial institutions to smaller businesses, with a focus on agribusiness and women-owned enterprises.
   
5. Grant to Kremenchuk City under the Ukraine Energy Efficiency Fund & Crisis Response Program: In a demonstration of solidarity and support for the victims of Russia’s aggression, €1.1 million in EU grants channeled through the IFC to Kremenchuk City Council to help renovate municipal buildings to accommodate hundreds of internally displaced people who fled the areas affected by the conflict.

Ukraine Recover Conference

The Ukraine Recovery Conference was held in London to mobilize international support for Ukraine’s economic and social stabilization and recovery from the effects of war, including through emergency assistance for immediate needs and financing private sector participation in the reconstruction process.

Great meeting with @Denys_Shmyhal today at #UkraineRecoveryConference. The Ukrainian people continue to heroically defend their sovereignty and territorial integrity. The United States is committed to supporting their democratic and prosperous future. pic.twitter.com/WFEItXNyBT

— Secretary Antony Blinken (@SecBlinken) June 22, 2023

On the margins of the Ukraine Recovery Conference, U.S. Secretary of State Antony Blinken met with representatives from the European Union, Canada, France, Germany, Italy, Japan, and the United Kingdom. The U.S. Secretary also held a meeting with Ukrainian Prime Minister Denys Shmyhal and underscored the U.S. “continued support for Ukraine’s economic recovery and commitment to working with the private sector to enable Ukraine’s modernization and revitalization.”

According to the Department of State readout, U.S. Secretary Blinken and Ukrainian Prime Minister Shmyhal also discussed “cooperation to strengthen Ukrainian institutions and accelerate progress on key reforms to ensure a strong investment climate, as well as supporting Ukraine’s vision for a more modern, secure, decentralized, and clean energy system integrated with Europe.”

On the margins of the conference, the first in-person meeting of the “Steering Committee of the Multi-agency Donor Coordination Platform for Ukraine” co-chaired by the United States, the European Commission, and Ukraine advanced on its extensive work to ensure that Kyiv’s urgent priority needs for this year are met and matched by donor commitments. The officials also discussed the “next steps” for continuing coordination on Ukraine’s reform agenda.