Ukrainian PM Denys Shmyhal has stated that Ukraine will need at least $565 billion for the initial post-war restoration. The government of Ukraine has already established four special restoration funds. They prioritise infrastructure, economic transformation, small and medium business and Ukraine’s international financial obligations.
The EU leaders have discussed possibilities to establish a special fund for the reconstruction of Ukraine, and different schemes are discussed. It is clear that Ukraine can expect a long-term support program as a EU membership candidate. Finally, possible sources of reparation funds in consideration are the arrested Russian and Belarussian assets.
National public opinion on Ukraine’s recovery potential is highly optimistic. 64% of Ukrainians believe that Ukraine will need less than 5 years to restore the damage caused by war, Western Ukraine and young people being the most confident. 61% of Ukrainians are prepared to contribute financially or manually, while only 5% believe that restoration is an exclusive responsibility of the Government. Predictably, 90% of Ukrainians want Russia to pay for damage, but there are also expectations for contributions from the EU (21%), international organisations (17%) and the US (12%).
The details of a restoration plan are the devil. Minister of Finance of Ukraine (2014-2016) and a manager behind post-hurricane restoration in Puerto Rico Natalie Jaresko suggested that reconstruction of housing and infrastructure of Ukrainian cities and villages will be effective only when a comprehensive inventory of destroyed assets is completed. The inventory can last for several years and requires a lot of international experts in engineering assessment as soon as possible. Only after the inventory is complete can a step-by-step strategy for post-war reconstruction be finalised. The Ukrainian government should take the coordinating role in restoration, but it obviously will partner with private contractors. It is still unclear whether a sectoral or a regional approach is more suitable for the country. It is important that the state took care of transparency of restoration funds, as well as proposed a comprehensive monitoring scheme. A trust fund seems to be the most viable option.
It is important to remember that abundanе financial support and popular enthusiasm cannot compensate for misplaced priorities and poor strategy. It is crucial to carefully review priorities and discuss plans for reconstruction as soon as possible. Expertise, evaluation, vision of economic development, transparency and accountability seem to be the first considerations. It is important to assess Ukraine’s needs in experts, as well as build local first response plans for restoration as the war continues. It is crucial to continue diplomatic pressure to introduce embargo on Russian imports and to secure a multi-national restoration fund for Ukraine.
Questions:
- What are the first considerations Ukraine should make to build a comprehensive restoration plan?
- Does Ukraine have a strategy of economic development that can guide restoration?
- Who should be responsible for the restoration strategy?
- Who should coordinate the process?
- What can be done as the war continues?
Speakers:
- Valeiy Pekar, lecturer at Kyiv-Mohyla Business School
- Hlib Vyshlinsky, Executive Director of Centre for Economic Strategy
UKRAINE IN FLAMES project is created by Ukraine Crisis Media Center, Ukrainian Catholic University’s analitical center and NGO “Euroatlantic Course”. We are aiming at searching a loud support for Ukraine in the war started by Russia on the 24th of February 2022.
If you want to support Ukraine against Russian aggression, check the link with recommendations by Ukraine Crisis Media Center – https://uacrisis.org/en/help-ukraine.
NGO Euroatlantic Course collects donations to support Ukrainian Army and civilians – https://eac.org.ua/en/main-page/.
