We invite you to read the second Ukraine Rebuilding Digest with an overview of the reconstruction news from the Recovery Alliance for 18-24 March.
Ukraine’s economic decline and recovery
The effects of the war on the Ukrainian economy were devastating. With the loss of production capacity, human capital and national savings, the economy suffered severe losses. In 2022, real GDP declined by 28.8%, more than 6 million refugees were forced to seek asylum in other countries, almost 5 million people became internally displaced, and more than a million citizens were mobilised into the Armed Forces of Ukraine. The loss of jobs, lower incomes and reduced purchasing power of the population are also consequences of the war. Unfortunately, more than 7 million people have fallen below the poverty line.
To ensure the survival of the state and the effective functioning of the war economy, it is necessary to make informed decisions on military-industrial, monetary and fiscal policies. The most important priority is to maximise domestic production to meet the needs of the front and rear.
Russian assets should be used to rebuild Ukraine this year
During a meeting of the EU-Ukraine Association Council, a senior EU official, Josep Borrell, proposed using interest accrued on frozen Russian assets in Ukraine’s interests. If this proposal is supported by the EU member states, the entire amount of such charges will be transferred to the EU budget and transferred to Ukraine: 90% for military needs and 10% for reconstruction programmes and the development of the Ukrainian defence industry.
Ukraine needs $486 billion to rebuild, Russia must pay
“According to the World Bank, Ukraine’s reconstruction needs are currently $486 billion,” the Prime Minister stressed.
During the meeting, Shmyhal, Herbst and Zelikov discussed practical steps to confiscate Russian assets, including the economic, political and legal basis for confiscating both Russian sovereign assets and those of Russian oligarchs, and considered the idea of introducing a special tax on Russian resources such as oil, gas and others.
Reconstruction Agency receives 12 modular bridges from the World Bank
The State Agency for Infrastructure Reconstruction and Development has received the first batch of modular bridges from the World Bank for the Restoration of Critical Logistics Infrastructure and Network Connectivity (RELINC) project. The first batch consists of 12 bridges worth USD 15.4 million, with a total contract value of USD 23.3 million. These bridges will be used to restore transport links after the destruction of bridges as a result of hostilities and to ensure the logistics of goods and cargo.
Ukraine Facility: Von der Leyen calls Ukraine’s recovery plan a turning point in EU cooperation
President of the European Commission Ursula von der Leyen has welcomed the constructive work of the Government of Ukraine in developing the Ukraine Recovery Plan as part of the Ukraine Facility for 2024-2027. She made the remarks during a joint press statement with Prime Minister of Ukraine Denys Shmyhal in Brussels. Von der Leyen expressed confidence that the Ukraine Plan is an important step for the country’s recovery from its losses, noting that it is a turning point in EU-Ukraine cooperation.
Resumption of flights. When will passenger planes fly in Ukraine?
Ukraine’s skies have been closed to civil aviation since the first day of the war. Although politicians have been discussing the possibility of resuming flights, discussions on this topic have been ongoing since 2022. The airports of Uzhhorod, Lviv and Boryspil have been mentioned as options. Even after a visit by a Ryanair delegation in July 2023, none of Ukraine’s airports have resumed operations, and airlines have not returned planes to Ukraine. Currently, passengers have to use railways and airports in neighbouring countries, as in the current situation, air travel in Ukraine is not expected to resume until the war ends or its intensity decreases.
Mykolaiv, a Danish model for rebuilding Ukraine – without corruption
The reconstruction plan for the city of Mykolaiv, which requires urgent recovery after a devastating war, can serve as a model for fighting corruption in Ukraine. The city council is working with the United Nations Economic Commission for Europe and Denmark. Mykolaiv, which has been targeted by Russian attacks due to its strategic importance, is suffering from massive shelling, which has led to half of its residents fleeing the city. In the summer of 2022, the city’s mayor asked the UN for assistance in developing a recovery plan. It is estimated that the reconstruction of the city could cost at least €852 million. Denmark has allocated the first DKK 100 million for this purpose, but the amount is planned to be increased.
Two forums were held in Washington, D.C., one dedicated to social and humanitarian work and the other to military chaplaincy. The participants presented the activities of Ukrainian communities, religious and volunteer organisations in Ukraine. The military chaplaincy forum brought together pastors who have helped Ukrainian soldiers and wounded Ukrainian soldiers who are currently undergoing treatment and rehabilitation. The Forum of Social and Humanitarian Work became a platform for discussing and concluding partnership agreements with organisations from different countries, facilitating the exchange of experience and resources in the field of humanitarian aid.
