We invite you to read the fifteenth Ukraine Rebuilding Digest with an overview of the recovery news from the Ukraine Rebuilding Alliance for 24—30 June.
Ukraine gets access to EUR 50 million from Spanish recovery funds
Ukraine has gained access to €50 million in Spanish public recovery funds to support the private sector, particularly small and medium-sized businesses. In addition, a €1 million grant was provided to support businesses and €4.6 million for humanitarian demining. This support was confirmed during the 4th meeting of the Joint Intergovernmental Ukrainian-Spanish Commission on Economic and Industrial Cooperation. First Vice Prime Minister, Minister of Economy Yulia Svyrydenko noted that the meeting provided an opportunity to discuss important issues of bilateral cooperation in the areas of economy, trade, investment, energy, transport, agriculture, science, healthcare, tourism and climate change.
Spain ranks 6th in terms of bilateral trade in goods between Ukraine and the EU, with a share of 4.8% of total trade. In January-April 2024, Ukrainian exports to Spain grew by 88.6%, reaching $1.094 billion. Svyrydenko stressed the importance of increasing the share of non-resource exports in this context.
“Ukrenergo receives new high-voltage equipment to restore Ukraine’s power system
NPC Ukrenergo has announced the receipt of new high-voltage equipment that will help restore Ukraine’s power system after Russian strikes.
Shunt reactors for Ukrenergo substations worth EUR 4.4 million were handed over to Volodymyr Kudrytskyi, Chairman of the Board of NPC Ukrenergo. This helps to strengthen Ukraine’s energy infrastructure, ensuring a stable supply of electricity to households and businesses.
Ukraine’s construction industry has the potential to become one of the main drivers of the country’s economic recovery in the post-war period. However, unlocking this potential requires coordinated efforts by the government, business and international partners.
According to the study “Structural Changes and Challenges in the Construction Industry of Ukraine: Analysis and Forecasts” conducted by the Kyiv School of Economics at the initiative of the European Business Association, significant private investment is needed for effective recovery. To date, there are only $500 million of investments in the construction sector, which is insufficient.
The World Bank estimates the total cost of reconstruction and recovery in Ukraine at $486 billion. Olena Shulyak, chair of the Verkhovna Rada Committee on the Organisation of State Power, Local Self-Government, Regional Development and Urban Planning, notes that about $65 billion is needed for construction materials alone to rebuild infrastructure.
Most of the necessary construction materials can be produced in Ukraine. This will be cheaper than imports, create additional jobs and increase tax revenues to the state budget. Currently, the share of domestic construction materials in total consumption exceeds 90%, and this figure can be maintained with the growth of construction.
Denmark to contribute EUR 4.7 million to restore power facilities in Mykolaiv and Kharkiv regions
The Ministry of Foreign Affairs of Denmark will transfer an additional grant of around EUR 4.7 million to the Energy Support Fund of Ukraine to restore critical energy infrastructure in Mykolaiv and Kharkiv regions. The total amount of donor contributions to the Fund, both transferred and announced, now stands at over €551 million. Minister of Energy of Ukraine Herman Galushchenko expressed his gratitude to Denmark, which became the first sponsor of the Fund in April 2022, for its continued support, especially important for the frontline regions.
The Energy Support Fund for Ukraine was established at the initiative of German Galushchenko and European Commissioner for Energy Kadri Simson in spring 2022 and has become an effective tool to help Ukraine’s energy sector over the past two years. In recent weeks, countries such as Germany, Australia, the United Kingdom and Austria have made contributions to the Fund or declared their intention to do so.
We cannot talk about rebuilding Ukraine without demining the territories
Complete demining of Ukraine would require $37 billion and about ten years, while only $850 million has been allocated so far. According to Deputy Minister of Economy Ihor Bezkaravaynyi, there are currently about four thousand specialists and more than 80 mechanised demining vehicles in Ukraine, which is an unprecedented scale. Bezkaravaynyi notes that humanitarian demining in Ukraine continues during the active phase of the war, setting new standards for global mine action.
Bezkaravaynyi, an ATO veteran, personally understands the importance of this process, having lost his leg to a mine. He emphasises that demining is a priority for Ukraine’s recovery and stresses the need for a professional approach, condemning unauthorised demining. The government is supporting agricultural producers through a compensation programme for the services of certified operators, and is working to coordinate the efforts of various ministries and international partners to ensure effective demining.
New initiatives to support entrepreneurs at the Ukraine Recovery Conference 2024
During the Ukraine Recovery Conference 2024 (URC2024), held on 11-12 June 2024 in Berlin, the governments of Ukraine and Germany announced a number of initiatives to support small and medium-sized enterprises (SMEs) in Ukraine. The main one, “Vision: Business Development Fund 2.0” (BDF 2.0), envisages the transformation of the Business Development Fund into a national development institution. This includes corporate governance reform, compliance with EU requirements for attracting funding and mobilising private investment.
To implement the initiative, the German Government will provide support at the level of governance and operation of the Fund, in particular through an institutional development project funded by the BMZ and implemented with the participation of Deloitte. The objectives include improving cooperation with donors, integrating environmental and social aspects, and adopting a new law. International partners such as the EU, the World Bank, Japan and Luxembourg have also pledged to support the Fund’s transformation, contributing to Ukraine’s economic recovery.
Ukraine and UNIDO sign the Green Industrial Recovery Programme for Ukraine for 2024-2028
On 28 June 2024, the signing ceremony of the Green Industrial Recovery Programme for Ukraine took place in Vienna. The programme was signed on behalf of Ukraine by Deputy Minister of Economy Nadiia Bihun and on behalf of UNIDO by Deputy Director General Yuko Yasunaga.
The programme is aimed at the sustainable recovery of Ukrainian industry in line with Sustainable Development Goal 9, Industries, Innovation and Infrastructure, adopted by the United Nations in 2015. It also aligns with Ukraine’s national priorities for early recovery and policy reform.
Nadiia Bihun expressed her gratitude to UNIDO for its support and noted that the programme will contribute to the development of green and sustainable industrialisation in Ukraine. The programme includes three main areas: creating opportunities for people, supporting businesses and attracting investment, and promoting a green economy.
