Page 14 - UKRRptNov23

The EU is currently putting together a special Ukraine Fund of €50bn that will be paid out over four years to support the economy. However, everyone is beginning to look forward to beyond the war when Ukraine will need hundreds of billions of dollars to rebuild and it remains unclear where the money will come from.
According to the chancellor, a separate fund for Ukraine should be created at the European level, combining grants and loans and coordinating private and state investments.
In the short-term Shmyhal says the government of Ukraine is negotiating with the European Commission to provide €18bn in 2024 to cover the budget deficit, which will amount to about $42bn. Half of Ukraine’s funding needs are expected to be covered by its international donors, according to the latest version of Ukraine’s 2024 budget .
Shmyhal was upbeat about the near-term prospects for Ukraine’s economy which has returned to growth in the last quarter and called on German businesses to invest into his country.
Ukraine's economy is expected to grow by more than 4% in 2023, even though the economy fell by 30% after the start of the war. In addition, inflation has already slowed to less than 9%, and international reserves are stable at about $40bn – their highest level in years.
The budget for 2024 includes a forecast of economic growth of 5%, said the Prime Minister during the Sixth German-Ukrainian Economic Forum in Berlin. Despite the war,
2.6 Ukraine can attract only $73bn in a “no reform” scenario
The World Bank has conducted an analysis of Ukraine's capacity to attract private investment, including scenarios with and without reforms, as the nation gets ready to rebuild, UBN reported on October 27.
Ukraine will face a massive need for investment when the fighting eventually stops. The World Bank estimates the cost of the damage inflicted by Russian aggression currency stands at a whopping $411bn – about twice the value of the entire economy before the war.
Experts from the International Finance Corporation (IFC) and the World Bank (WB) have a "no reforms" scenario, which reflects conditions prior to the conflict. Under this scenario, the two IFIs estimate Ukraine can attract over $73bn, or approximately 18% of the total needed.
In contrast, by embracing and accelerating economic reforms, addressing industry regulations, and deepening integration with Europe, Ukraine can potentially attract $130bn in private sector investment, equivalent to about 30% of the total reconstruction needs.
Furthermore, these reforms could pave the way for an additional $282bn in private-sector investment.
14 UKRAINE Country Report November 2023 www.intellinews.com