What opportunities will businesses get under the EU's Ukraine Facility investment component - the Ministry of Economy's response
Kyiv • UNN
The €9.3 billion investment framework for Ukraine under the EU's Ukraine Facility program will provide Ukrainian businesses with access to additional financing from international financial institutions through a €7.8 billion guarantee facility and €1.5 billion in blended finance and technical assistance.
The investment component of the Ukraine Investment Framework within the EU's Ukraine Facility program with a budget of 9.3 billion euros will allow businesses to access additional financing, the Ministry of Economy reported, UNN writes.
Details
Deputy Minister of Economy Volodymyr Kuzio said that the Ukraine Investment Framework (UIF) is the second component of the Ukraine Facility. It aims to mobilize investments for the recovery and development of Ukraine.
The EUR 9.3 billion Ukraine Investment Framework will help to intensify the work of international financial organizations in Ukraine by providing businesses with access to additional financing. To this end, the program is creating a €7.8 billion Ukrainian guarantee mechanism that will cover the risks associated with operating in a country at war. This will allow IFIs to expand their existing financing programs for Ukrainian businesses and launch new instruments, making capital raising more accessible to entrepreneurs. The remaining €1.5 billion from the EU will also be used for blended business financing and technical assistance
As indicated, the EU will provide funding under the UIF to international financial organizations, which in turn will expand their own programs and create new instruments for Ukraine, as well as support Ukrainian partner banks.
"The UIF will allow businesses to reduce collateral requirements for lending, attract mixed financing that combines grants and loans, and receive technical assistance in preparing applications for financing and finalizing investment projects. Both state-owned and private companies will receive such opportunities," Volodymyr Kuzio said.
Under the UIF, operations for the private sector will reportedly be initiated by IFIs based on demand from private companies. In turn, public projects will be initiated by the government as part of public investment management and a single project list.
The final terms and programs for the first phase of the UIF will be approved at the Ukraine Recovery Conference 2024, which will be held in Berlin on June 11-12.
"In the next stages, we expect the program to expand further and even more companies to get access to funding. At the same time, the key task for this is to create an up-to-date list of investment projects that will allow us to clearly define our needs and priorities. In the future, the list will become the basis for negotiations with IFIs and other partners to improve financing programs," Volodymyr Kuzio emphasized.
