The European Investment Bank (EIB) will set up a fund to support the short-term financial position of Ukraine and pay for long-term rebuilding projects.
The EU-Ukraine Gateway Trust Fund was announced yesterday at the two-day Ukraine Recovery Conference in Lugano, Switzerland, attended by representatives of more than 40 countries.
The fund will have an initial capitalisation of €20bn in the form of grants, loans and guarantees from EU countries and the budget of the union itself. This sum is expected to attract another €80bn in matching funds.
It would be similar to another facility set up by the EIB to offer finance to small and medium-sized companies in the wake of the Covid-19 pandemic.
Swiss President Iganzio Cassis hailed the declaration as a “first step on the long road of Ukraine’s recovery”. He said: “Our work prepares for the time after the war even as the war is still raging. This should give the people in Ukraine hope and the certainty that they are not alone.”
Ukrainian Prime Minister Denys Shmyhal told the conference that €750bn would be needed to repair the country’s infrastructure.
The conference ended today with the publication of the Lugano Principals, which will guide post-war reconstruction to make the recovery transparent and free of corruption, AFP reports.
Svenja Schulze, Germany’s minister for development, told German news agency DPA that the Ukrainian recovery effort would not be “a project for one year or two”, although the most urgent task was preparing warm homes for the coming winter.
She added: “There are huge opportunities for the German economy because Ukraine is a big country. It has a large population, and it’s of course interesting for an export nation like Germany to be represented there.”
So far, the EU bank has committed almost €4.7bn in support to Ukraine. The new fund could be used to rebuild bridges and renovate energy, water and sewage infrastructure, as well as expanding services in cities housing refugees.