Actions to Support Ukraine’s Economic Recovery 06/16/2024 12:46 PM EDT

 Actions to Support Ukraine’s Economic Recovery

06/16/2024 12:46 PM EDT

Office of the Spokesperson

Last week, the United States Government participated in the Ukraine Recovery Conference in Berlin, Germany. The conference convened over 1,500 representatives from governments, businesses, and civil society to mobilize support for the recovery, reconstruction, reform, and modernization of Ukraine.

Initial conference deliverables include the following:

• $824 million in energy assistance to support Ukraine’s energy infrastructure efforts in the midst of continued Russian attacks.  That includes notifying Congress of our intent to support Ukraine with $500 million in new energy assistance and pivoting $324 million from our previously announced other energy assistance to meet Ukraine’s most urgent needs. This will bring the overall U.S. commitment to Ukraine’s energy system to approximately $1.5 billion since 2022.
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• $50 million first-of-its-kind war-risk reinsurance facility in Ukraine. Intended to fill a critical market gap of war-risk insurance for companies operating in Ukraine in the midst of Russia’s ongoing full-scale invasion of Ukraine. This reinsurance facility, brokered by Aon, will enable the U.S. International Development Finance Corporation (DFC) to reinsure war risk underwritten by ARX, a Ukrainian subsidiary of Fairfax Financial Holdings Limited, and support ARX in expanding its war-risk insurance offering in Ukraine.
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• Launch of the Business Advisory Council (BAC) to the Multi-Agency Donor Coordination Platform, whose inception was co-led by the United States and Germany.  The BAC will provide essential private sector insights, expertise, and visibility to catalyze private investment in support of Ukraine’s economic recovery.
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• $28 million loan portfolio guarantee for small and medium-sized enterprises (SMEs) in Ukraine. Through this project, which is co-sponsored by the U.S. Agency for International Development (USAID), DFC will provide ProCredit Bank Ukraine with a loan portfolio guarantee to support lending to SMEs across Ukraine, at least 50 percent of which will be lending in the agricultural sector.
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• Over $350 million in political risk insurance (PRI) contracts in Ukraine. DFC has four additional PRI transactions worth over $350 million, recently approved by DFC’s management, in priority sectors for Ukraine’s economic recovery such as agriculture, pharmaceuticals, and education.
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• DFC signed a “declaration of intent” with the European Bank for Reconstruction and Development (EBRD), to support EBRD’s trade financing program in Ukraine.  This initiative aims to explore opportunities to share trade-finance risk on trade instruments guaranteed by approved local issuing banks.
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• DFC signed a memorandum of understanding (MOU) with Citi and Ukraine’s Ministry of Economy to cooperate in identifying opportunities to support mortgage financing in Ukraine. Through this MOU, DFC, Citi, and the Ministry of Economy announced the intent to cooperate to identify opportunities to support local -currency residential mortgages.
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• G7+ Joint Statement highlighting progress since URC2023 and new support. The United States contributed to and will endorse the U.S.-led G7+ Joint Statement that will reaffirm continuing support for Ukraine’s energy sector. The Joint Statement will highlight U.S. and partner contributions and acknowledge the Government of Ukraine’s progress on key energy sector reforms, along with next steps on those reforms and on improving the business-enabling environment.
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• The United States, Ukraine, the EU, and UK will work with Ukraine under the Multi-Agency Donor Coordination Platform (MDCP) to develop a pre-project preparation framework with the World Bank and European Investment Bank (EIB), open to other partners, to enable priority recovery and reconstruction projects to get to bankability for external investment.
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• USAID joined three Federal Ministry for Economic Cooperation and Development initiatives: the SMEs, Skills, and Gender Alliances.
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  • Skills Alliance: Given the magnitude of the skills-gap challenge and the short timeline to upskill a large number of workers, innovation and private-sector participation must be at the center of any proposed solution. Existing USAID workforce development activities related to business competitiveness, youth employment, digital and cyber security, veterans’ inclusion, and other interventions across USAID/Ukraine’s assistance portfolio will contribute to the Alliance’s intended outcomes.
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  • Alliance for Gender-Responsive and -Inclusive Recovery: Gender equity and social inclusion are cross-cutting programming priorities for USAID/Ukraine. They are embedded into all ongoing and planned programming, contributing to and in line with the Alliance’s commitments and intended outcomes. Joining the Alliance sends a strong, signal to donors, international organizations, and the business community that a gender-responsive and -inclusive recovery for Ukraine is crucial for its effectiveness and sustainability.
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  • SME Resilience Alliance for Ukraine: USAID’s private-sector strategy promotes Ukraine’s rapid economic recovery by assisting SMEs, the backbone of a strong private sector, to bolster economic resilience, foster innovation, and generate high-value employment opportunities. Joining the Alliance showcases USAID’s contributions and commitment to supporting the SME sector as a key driver of economic recovery.
• USAID joined the Sustainable Municipalities Coalition for Ukraine. USAID/Ukraine is implementing programs that are in alignment with the aims of the Sustainable Municipalities Coalition and its thematic areas. It aligns with USAID’s existing activities under the governance and decentralization program related to strengthening local governance systems with enhanced capacities to deliver essential services, foster economic recovery and revitalization. Joining the Coalition will underline that USAID/Ukraine programs complement the goals of the Sustainable Municipalities Coalition. 
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• USAID and EBRD signed an MoU on collaboration on infrastructure, economic growth, and energy to support Ukraine’s recovery. USAID and EBRD collaborate across a range of area in Ukraine, including EBRD’s work in the field of transport infrastructure, which complement USAID’s investments in rail and border-crossing points.  The MOU asserts both sides’ intent to collaborate at the strategic and programmatic level to extend their impact and increase Ukraine’s economic resilience in the face of Russia’s continued attacks. 
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• USTDA’s nuclear power deployment technical workshops. Ukrainian nuclear power sector delegates will come to the United States to join the first of four U.S. Trade & Development Agency (USTDA)-sponsored Europe and Eurasia Civil Nuclear Energy Deployment workshops that will be held in the United States and Europe to explore pathways to further nuclear power deployment in Ukraine and the region.
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• USTDA technical assistance for small modular reactor (SMR) licensing-gap analysis for the Science and Technology Center in Ukraine (STCU). 
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• Completed in April 2024, $1.3 million in USTD Ag-funded technical assistance supported the State Nuclear Regulatory Inspectorate of Ukraine in identifying gaps in Ukraine’s existing nuclear regulations as it relates to SMR technologies. USTDA provided a list of recommendations to close regulatory gaps in order to facilitate SMR technology deployment.
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• The Export-Import Bank of the United States (EXIM) joined a Memorandum of Cooperation (MOC) among export credit agencies (ECAs), initiated by the German URC- host ECAs.  The MOC included the ECAs of Denmark, Italy, Japan, Italy, and Poland, among others. The signed MOC affirms that, despite the war against Ukraine, signatory ECAs are determined to find ways to support exporters and investors seeking to deepen their partnerships with Ukrainian companies for Ukraine’s economic, social, infrastructure and environmental reconstruction and development.