Page 50 - bne magazine September 2023

50 I Eastern Europe bne September 2023
June report from the Kyiv School of Economics (KSE). The Agency has received over 400,000 inquiries from liberated territories, 40% of which concern housing.
“For us, it's important now to hear what the regions need and to help them to cover this gap in financing or expertise,” Nayyem says.
Reconstruction is now at the forefront of discussions about Ukraine and Nayyem wears a look of exhaustion from working non-stop since the creation of the Agency in January. Nevertheless, optimism shines through as he explains that Ukraine will have no problem with funding the process.
“There are a huge number of partners who want to help, and they are now defining the process of delivering this money. I think this year will be the first to have a big amount of money,” he says.
Currently funding from allies and institutions is simply filling the
holes in the state budget, whilst
the Ukrainian government is in the process of restructuring loans from institutions. But the Agency has small projects with the UK, World Bank, European Investment Bank and the European Bank for Reconstruction and Development (EBRD) for rebuilding, although not at the level that Ukraine needs. Additionally, countries like Poland, Lithuania and Estonia are implementing their own projects on the ground, with Warsaw funding temporary accommodation for IDPs in the de-occupied towns outside Kyiv.
Ukraine also launched the Fund for Liquidation of the Consequences of Russian Aggression in January 2023, which consists of seized funds and assets belonging to the Russian Federation
and Russian citizens which will be used in the reconstruction process. The 2023 state budget allotted UAH35.5bn ($965mn) to the fund, with priority
on rebuilding destroyed housing and critical infrastructure facilities, and the government confiscated $462mn from Russian banks at the start of the year.
“Regarding all support of our partners, we understand that we will not have
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problems with financing. The problem for all of us is to do it as fast as possible,” Nayyem explains.
Bureaucracy is holding back the delivery of urgent funding and Nayyem believes the process needs to be better co-ordinated to urgently help those in need. One of the ways to speed up the flow of money is through partnerships with the private sector, with Ukraine offering attractive opportunities. The government is currently in the process of creating insurance for hesitant companies concerned about the war and the Agency has signed several non-
he doesn’t believe in implementing harsher punishments for guilty parties.
“Punishment is when everything has happened, when you cannot bring back money in time. So, the main tool should be prevention and deterrence,” he said.
However, a recent report from Transparency International found that 24% of Ukrainian citizens and 18% of Ukrainian businesses were in favour of increasing criminal liability for corruption. The overwhelming majority of Ukrainian citizens and businesses (73% and 80% respectively) listed the resumption of
“There are a huge number of partners who want to help, and they are now defining the process of delivering this money. I think this year will be the first to have a big amount of money”
disclosure agreements with enterprises who have expressed interest in public- private partnerships.
The private sector was pinpointed at
the Ukraine Recovery Conference in London last month. However, many expressed concerns about Ukraine’s corrupt reputation. Kyiv has taken this to heart and Nayyem points to the recently launched DREAM platform, which aims to make the reconstruction process as transparent as possible.
“DREAM collects, organises and publishes open data across all stages of reconstruction projects in real time, implementing the highest standards of transparency and accountability. Anyone, anywhere, can monitor the effectiveness and efficiency of project delivery, and use these insights to mitigate risks, conduct accurate reporting and improve overall project performance,” the website states.
Nayyem believes implementing transparency and corruption prevention measures in all agencies will help change the approach for procurement and other issues and build trust with partners. However, unlike many Ukrainian citizens,
corruption schemes as their top fear post-war. But Nayyem is confident that the government will tackle these issues head-on as part of Ukraine’s rebranding.
Build back better
The physical reconstruction process will begin in August with the experimental “build back better” project. It will be trialled in six settlements in the Kherson, Kyiv, Sumy, Kharkiv and Chernihiv regions, which should become fully habitable within a year, according to Nayyem.
Currently, only Ukrainian construction firms are involved in the rebuilding process due to fears of foreign companies over hostilities. Nevertheless, Nayyem welcomes international companies to register in Ukraine in order to make the market more competitive and ensure the highest quality.
“But everything should be done in Ukraine. It's very important, because Ukraine has its own big capacity to produce materials and enough experts and specialists and labour who can work on this project,” he stresses.
Reconstruction will play a crucial role in boosting Ukraine's depleted workforce, which has suffered a 30% drop since the