LONDON: Ukrainian prime minister Denys Shmyhal said on Wednesday he expected to secure almost US$7 billion in aid, after telling a London conference Russia’s war meant Kyiv was facing the largest reconstruction project in Europe since World War Two.
At the conference Britain, the US, the European Union and others pledged billions of dollars in additional help, as Ukraine said it needed yet more capital and also commitments to specific projects to not only recover but to develop into a powerful member of the Western world.
Ukrainian prime minister Denys Shmyhal put the price tag for funds needed at more than US$6 billion over the next 12 months, then later said on his Telegram messaging channel he expected to secure almost US$7 billion.
“The key objective is to mobilise resources to finance rapid recovery,” he said on Telegram.
While expressing thanks for the support so far, Ukrainian president Volodymyr Zelensky was blunt – Kyiv also needed concrete commitments to projects that will help Ukraine not only recover but to further modernise.
After nearly 16 months of Russia’s war on Ukraine that has destroyed homes, hospitals and other critical infrastructure, British prime minister Rishi Sunak opened the conference with an appeal to businesses and governments to do more to help rebuild.
Addressing the key difficulty for most companies wanting to invest in Ukraine – insurance against war damage and destruction – Sunak announced the London Conference Framework for War Risk Insurance, which could pave the way for de-risking investment.
“Together with our allies we will maintain our support for Ukraine’s defence and for the counter-offensive, and we’ll stand with Ukraine for as long as it takes as they continue to win this war,” Sunak told the conference, which brought together more than 1,000 public and private sector decision makers.
He said the London Conference Framework was “a huge step forward towards helping insurers to underwrite investments into Ukraine, removing one of the biggest barriers and giving investors the confidence they need to act”.
Marsh McLennan, a professional services group that says it has been working on the British government programme, said a war risk insurance scheme has to be available at an unprecedented scale – and come with a government backstop.
More aid offers
Sunak unveiled measures including US$3 billion of additional guarantees to unlock World Bank lending. This includes a pledge of £20 million (US$25.42 million) to boost access to the World Bank’s Multilateral Investment Guarantees Agency, which provides political risk insurance for projects.
European Commission president Ursula von der Leyen said the EU would provide Ukraine with €50 billion for 2024-27, while US secretary of state Antony Blinken offered US$1.3 billion in additional aid.
German foreign minister Annalena Baerbock said Berlin was offering an additional €381 million in humanitarian assistance in 2023.
But Zelensky, speaking via video link, said Ukraine needed more targeted help in “real projects” that would spur growth in an economy he said had moved far away from the oligarchic model of Ukraine’s immediate post-Soviet era.
Ukraine is seeking up to US$40 billion to fund the first part of a “Green Marshall Plan” to rebuild its economy, including developing a coal-free steel industry, a senior Ukrainian official said before the conference.
The total bill will be huge, with Ukraine, the World Bank, the European Commission and the United Nations estimating in March that the cost was at US$411 billion for the first year of the war. It could easily reach more than US$1 trillion.
Western officials hope the conference will encourage the private sector to harness its resources to help speed Ukraine’s reconstruction by investing in small and medium-scale projects. Sunak said more than 400 companies from 38 countries had signed up to the Ukraine Business Compact, a statement of support for Ukraine’s recovery.
European Investment Bank president Werner Hoyer said he got the feeling while listening to the conference speeches that “not everyone has realised that speed is of the essence”.