Ukraine receives $3.87B for rapid recovery this year
The Ministry of Finance of Ukraine made a relevant announcement following a meeting between Minister of Finance Serhii Marchenko and France's Special Envoy for Ukraine's Relief and Reconstruction Pierre Heilbronn.
The meeting took place on July 13. The parties discussed the work of the Multi-Agency Donor Coordination Platform for Ukraine, the rapid recovery needs, as well as the preparation and implementation of the Ukraine Facility.
During the discussion of the Multi-Agency Donor Coordination Platform for Ukraine, the minister noted that during the first months of 2023, main efforts were directed towards ensuring predictable and rhythmic budget support, as well as funding for the recovery of Ukraine.
“Overall, we have commitments from donors for almost USD 42.5 billion in macro-finance support in 2023 to finance the deficit of the state budget of Ukraine. Thanks to the coordinated work of the Government of Ukraine with international partners, the current work of the Platform is focused on further detailing the priority recovery needs, the current status of disbursements, and the capacity to implement projects in the early reconstruction phase,” Marchenko explained.
He noted that there is a certain discrepancy between the projects that partners want to invest in and our needs. That is why the Ukrainian side and international donors are currently coordinating the list of urgent recovery projects and available resources.
Of all the financial commitments of the partners for Ukraine’s recovery, only USD 3.87 billion meets the needs of rapid recovery, which is estimated at USD 14.1 billion. At the same time, the finance minister emphasized that rapid recovery is a key priority, as it contributes to the creation of safe living conditions for Ukrainians, as well as the country's economic recovery.
Funding raised in the amount of $3.87 billion is distributed according to priority sectors, namely: energy support – $837 million, humanitarian demining – $169 million, housing – $25 million, private sector – $206 million, and critical infrastructure recovery – $2.6 billion.
Marchenko also emphasized that during the Ukraine Recovery Conference (URC-2023), which took place at the end of June in London, EU leaders announced the creation of the Ukraine Facility. This instrument will be part of the multiannual financial program of the EU for 2024-2027. The Ukraine Facility will focus on supporting Ukraine's macro-financial stability, promoting recovery, reconstruction and modernization, as well as facilitating the transition to a green, digital and inclusive economy.
As the minister noted, the Ukraine Facility will contain three main components: financial support in the form of non-refundable and credit support for Ukraine; an investment framework designed to attract private and public investments; technical assistance and support measures, including expert assistance on reform issues.
“In order to implement the Ukraine Facility mechanism, the Government of Ukraine must develop a plan for recovery, reconstruction and modernization. This plan will serve as a reference point for other donor assistance programs for Ukraine,” Marchenko.
