Category: Publications

The European Investment Fund (EIF) and the Danish Export Credit Agency EIFO have signed the first agreement under the European Union’s export credit guarantee program for Ukraine. This initiative aims to support European companies working with Ukraine and to strengthen Ukraine’s economic integration with the EU.

The signed guarantee — the first of 13 similar agreements being prepared in EU member states — provides financing of up to €20 million for export credit operations, enabling about 40 Danish companies to strengthen their presence in the Ukrainian market.

The EIF guarantee mechanism is implemented within the innovative “export credits” program supported by the InvestEU initiative of the European Commission.

“This export credit agreement — the first of thirteen — underscores the European Union’s commitment to a strong Ukraine within the European family. Securing trade links between the EU and Ukraine is a key factor in supporting the Ukrainian economy and deepening bilateral relations on Ukraine’s path towards future EU accession,” commented Nadia Calviño, President of the EIB Group.

“In 2024, according to Eurostat, exports from the EU to Ukraine amounted to €42.8 billion — 9.4% more than in 2023. This indicates that Ukraine remains a stable and important market for European goods, ranging from machinery and transport to pharmaceuticals and clean technologies. The export credit guarantee mechanism, implemented by the European Investment Bank Group and the European Commission, helps reduce risks for European companies. Through national export credit agencies, this instrument gives businesses confidence to work with Ukrainian partners and develop trade. This initiative supports Ukraine’s economy and facilitates our gradual integration into the EU single market. We appreciate this support and consider it an important contribution to recovery and development,” said Yulia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine.

“I welcome the signing of the first €20 million agreement under the export credit guarantee mechanism for Ukraine — between the Danish Export-Import Fund and the European Investment Fund. Supported by the EU budget, this mechanism helps European businesses maintain and expand trade links with Ukraine. It is an important step forward toward deeper integration of the EU and Ukrainian economies — a key element of Ukraine’s EU accession process. We expect other member states to take advantage of this mechanism and contribute to the success of this important initiative,” stated Valdis Dombrovskis, European Commissioner for Economy, Productivity, Implementation, and Simplification.

This first agreement with EIFO launches a series of approximately 13 similar agreements across EU member states. Overall, the export credit program, which provides about €300 million in guarantees to support European small and medium-sized enterprises (SMEs) and mid-cap companies from the EU, received an application volume significantly exceeding the available funding just weeks after its launch in July 2024. This demonstrates high interest from European businesses.

“Ukraine’s fight for freedom is also our fight for freedom. Ukraine’s future lies in the West. Even closer economic integration is a powerful step in the right direction. Danish businesses have repeatedly demonstrated their leading role in Ukraine’s reconstruction process. This initiative paves the way for even deeper cooperation between Danish and Ukrainian companies. It provides real support to Danish companies wishing to work in Ukraine, while also extending a helping hand to their Ukrainian partners. This is an important contribution to shaping Ukraine’s future,” said Morten Bødskov, Denmark’s Minister for Industry, Business, and Financial Affairs.

Background

The European Investment Fund (EIF) is part of the European Investment Bank (EIB) Group. It supports small and medium-sized enterprises (SMEs) in EU countries by providing access to finance through a wide network of authorized financial intermediaries. EIF develops and implements equity and debt financing instruments that promote entrepreneurship, innovation, green and digital transitions, and job creation.

The InvestEU program provides long-term EU financing by mobilizing public and private investments. The program unifies EU financial instruments into a single architecture, simplifying access to financing and increasing its effectiveness. It consists of three components:

• The InvestEU Fund (EU budget guarantee — €26.2 billion);
• InvestEU Advisory Hub;
• InvestEU Portal.

Its overall goal is to mobilize over €372 billion in investments between 2021 and 2027.

EIFO is Denmark’s national development bank and export credit agency. It operates in over 100 countries, with transactions exceeding €20 billion. EIFO offers financial solutions to support Danish companies, promotes the green transition, and invests in technology and Denmark’s defense industry. The agency actively cooperates with partners worldwide, including in Ukraine.

Source: https://odessa-journal.com/first-eu-export-credit-guarantee-agreement-for-ukraine-secures-20-million-via-danish-agency-eifo

German business is ready to invest in the Ukrainian economy despite the war.

Ukraine joined the top 3 attractive countries for investment despite the war lasting for almost three years.

Eastern Europe is becoming increasingly attractive for German business. More and more German companies already investing or planning to invest in the region in the near future. Not least of all, this concerns Ukraine, as reported by Deutsche Welle.

The article highlights, “They [German entrepreneurs – ed.] treat Poland, Romania, and Ukraine as the most attractive countries for investment, followed by Hungary and the Czech Republic. A significant part of the projects planned for the Ukrainian market will be launched this year, despite the ongoing Russian aggression”.

Relocating production to Eastern Europe

The trend of relocating production to Eastern Europe is confirmed by a survey conducted by the international consulting company KPMG and the Eastern Committee of the German Economy, in which 133 companies operating in this region participated.

More than half of them (55%) believe that by the end of the decade, the importance of Eastern European countries for their business will increase. However, only 7% are skeptical.

Regarding investments in Eastern Europe, 42% of respondents reported that they have already budgeted for costs of establishment, expansion, or relocation of production to Eastern Europe in the 2025 budget, while 56% are planning to do so in the next 5 years.

Andreas Glunz, the KPMG representative, explained, “Well-known problems concerning investment climate in Germany are forcing local companies to move their production abroad. In such a case, the best direction is Central and Eastern Europe. German business has already made large-scale investments there, has studied very well local conditions, and at the same time remains close to its home country”.

In the respondents’ opinion, this region is attractive due to high domestic demand and qualified personnel. Meantime, low labor costs turned out to be only the third most important reason.

What attracts investors to Ukraine

The most unexpected result of the survey is the high interest in investing in Ukraine, despite the ongoing war.

Michael Harms, Executive Director of the Eastern Committee of the German Economy, emphasized, “It is especially noteworthy that Ukraine ranked third among the most attractive countries for investment. It shows the great economic potential of this country”.

Among 133 surveyed companies, one in five (21%) is already an investor in the Ukrainian economy, and slightly more than a third (35%) are planning to invest by the end of this year.

However, 41% of companies are planning to invest in the Ukrainian economy for the next five years, as they expect its accelerated joining the EU. This is almost the same number of companies as those planning to invest in Romania, and significantly more than in Hungary (35%), the Czech Republic (31%), and Bulgaria (22%).

Nicolai Kiskalt, Head of the Central and Eastern Europe Desk at KPMG Germany, noted, “Despite the war, more and more international and German companies are investing in Ukraine – a country with the potential to become an energy hub for the European Union, to turn into alternative production site and to play a vital role for European companies in IT and outsourcing”.

Meantime, two-thirds of German businessmen (67%) named political risks and lack of security as the main obstacles to investment in the region as a whole, while corruption and bureaucracy are much less of a concern for entrepreneurs; respectively, 38% and 31% of respondents treat them as a problem.

We remind that America and Europe are interested in Ukraine’s victory and its achievement of long-term economic success. Mike Pompeo, former US Secretary of State, now a member of the Board of Directors of the global telecom operator VEON and its Ukrainian asset – Kyivstar, believes that Ukraine’s Western allies should help it win the war and support its economic recovery and growth with strong investments.

Source: https://tsn.ua/groshi/nimeckiy-biznes-gotuyetsya-do-investiciynogo-bumu-v-ukrayini-deutsche-welle-2760477.html?fbclid=IwZXh0bgNhZW0CMTEAAR1AMkL6sEzGnXkpymeag_9tXFjs0ttsV663R7FesTuIZcXwJMva7okFIXc_aem_oQLj4B97oMPi631FDDOmqw

The ports of Odesa and environs will be key to any significant post-war recovery in Ukraine. Already much headway has been made in the area of security.

There are many stories of resistance to the Russian invasion by the Ukrainians. Not only the soldiers at the front, but also the unknown heroes who continued to work in their place so that the State could continue to function. This is the case of the ports of Odesa, an essential artery for Ukrainian exports.

“Eighty percent of the country’s exports came out of the Ukrainian ports,” says Deputy Minister of Infrastructure Yuriy Vaskov, the man responsible for ports and river and rail transport from the beginning of Russia’s full-scale invasion until May 2024. Then he followed the fate of the Minister Oleksandr Kubrakov, dismissed by President Volodymyr Zelensky.

Together, Vaskov and Kubrakov founded the We Build Ukraine think tank in partnership with Boston Consulting Group, to define the strategic priorities of reconstruction and guide foreign investments in Ukraine.

“From the first day of the invasion in February 2022, Ukrainian ports were blocked by the Russian fleet,” Vaskov says, “and exporters looked for alternative routes, such as trucks and trains, but with profits close to ‘0’ due to non-competitive costs. On the other hand, the ports on the Danube, Izmail and Reni, increased their cargo movement 20-fold because they could cross the neutral waters of Romania.”

It was a partial solution, because the Danube seabed is not as deep as in seaports, so they can only work with flat-bottomed vessels with limited loads.

Then, in July 2022, there was the agreement to establish a grain corridor, known as the Black Sea Grain Initiative. Thanks to the diplomatic mediation of Turkey and the United Nations, the initiative lifted the Russian naval blockade of the ports of the Odesa region (though not in Mykolaiv) to allow the export of wheat and cereals. The 65 ships blocked for months in the ports were able to go out to sea again and exports resumed almost to the pre-war level.

It was then that the world became aware of the strategic value of Ukrainian agricultural exports, on which the food of 400 million people depends. That agreement lasted a year. But in the meantime, the losses inflicted on the Russian fleet due to attacks by Ukrainian maritime drones and missiles had cleared the sea of enemy ships. Since then, merchant ship traffic has resumed without having to negotiate with the Russians.

“The world became aware of the strategic value of Ukrainian agricultural exports, on which the food of 400 million people depends”

Among the officials who have remained in their posts, despite the personal risk, is Aleksey Myaskovsky, who for five years has headed the port authority that manages real estate and port services in Odesa. In the past three years, some of his employees have died because of attacks on the docks, but the workforce has remained in place, implementing safety regulations (shelters and working at a physical distance). As workers in critical infrastructure, 70% of the port employees are protected from military mobilization.

The Ukrainian economy depends on the seven ports in the region: three main ones around Odesa (the historic port, Chornomorsk and Yuzhny), three on the Danube (Izmail, Reni, Ust-Dunaysk) and one at the mouth of the Dnister (Bilhorod-Dnistrovsky). Despite the war, some of these ports have been privatized. Ust-Dunaysk and Bilhorod-Dnistrovsky were given in concession through a public tender to Ukrainian investors. But the Ukrainian government’s privatization policy does not stop. This year, two terminals in the port of Chornomorsk will be put up for grabs (the procedure for one terminal is already online) and as soon as the war is over, the cruise terminal in the historic port will be given in concession, where the burnt-out skeleton of the old Hotel Odessa, destroyed by missiles, stands tall.

According to Myaskovsky, the process of privatization of the maritime sector is now irreversible, due to Ukraine’s ambition to become a member of Europe. Law 4196-IX of February 2025 will transform all public companies into joint-stock companies – a process necessary to allocate more resources to ports. In the current system, the Ukrainian Port Authority (USPA) collects all the revenues for the services offered to shipping companies, but redistributes an infinitesimal part to maintain the infrastructure.

Merchant traffic today occurs thanks to the reduction of the risk of war and new insurance policies that shipping companies can buy.

“Security is the main problem of maritime traffic in the Black Sea,” says Arthur Nitsevych, founder of the law firm Interlegal, the largest in Ukraine for maritime law (50 lawyers), with offices in all the countries bordering the Black Sea, plus Greece and Cyprus.

From 2022 and almost all of 2023, no insurance policy for war risk available, Nitsevych explains. “Then, in November 2023, a London insurance company with a partial guarantee from the Ukrainian government offered a policy that initially cost 5% of the value of the cargo. Today it has dropped to 1-1.5%.”

However, the lawyer tells us, this insurance is voluntary, not mandatory. There are many ships owned by Turkey, Arab countries, and even Ukrainian owners, that accept the risk and sail without paying these expensive policies, to increase profits. They simply pay the policies required at an international level in each port, relating to the personnel and technical equipment of the ship.

“Security is the main problem of maritime traffic in the Black Sea.”

According to him, the reconstruction of Ukraine will lead to a further increase in port traffic because in addition to agricultural and mineral commodities there will also be construction materials. This will be a challenge for the Ukrainian port administration, which suffers from inefficiencies due to regulations defined by officials in Kyiv who often do not fully understand the economics of the port.

Regarding the economy of Ukraine, Vaskov predicts that the Ukrainian GDP will increase by 2.5-3 times in 15 years. To achieve this, a stable peace in conditions of economic security will be needed. It will be necessary to reopen the port of Mykolaiv, where there is a terminal of the Chinese operator COFCO, and from which the steel products of the Indian giant Arcelor Mittal departed. It is useful to note that Mykolaiv is already the object of the majority of Danish investments in Ukraine. And then we need to relaunch river traffic on the Dnipro, with the reconstruction of the Nova Kakhovka dam destroyed by the Russians.

The great strategic perspective for Ukraine is to hook up to the India-Middle East-Europe-Economic-Corridor (IMEC) project, the logistics corridor launched by India to connect to Central Eastern Europe through the Emirates, Saudi Arabia, Israel and the Mediterranean. Odesa could take advantage of this corridor by offering its rail connections to Poland, Lithuania and Estonia, to reach the Baltic Sea more quickly. It is no coincidence that the Polish European Commissioner has publicly announced Poland’s interest in investing in the port of Odesa. And Vaskov himself confirms that there are already projects with European partners to create new railway lines with the distance between the tracks used in Europe (Ukrainian railways have a wider gauge), to improve connections with European markets.

“The lack of a maritime strategy for Ukraine has always been its weak point.”

Ukrainian ports will play a decisive role in the revival of the economy, but on the condition that the government defines the maritime strategy of Ukraine.

“The lack of a maritime strategy for Ukraine has always been its weak point,” complains Roman Morgenstern, Director of Marketing and International Projects at Ukrferry. “In Kyiv there has always been a lack of knowledge of the port activity and the will to increase the role of Ukraine on the seas.” In this regard, the case of the Black Sea Shipping Company, known as BLASCO, is emblematic. With its independence, Ukraine inherited the Soviet merchant fleet, which with its 400 ships was the largest in the world. Due to a lack of expertise and a lot of corruption, that economic heritage was completely lost, between ship sales and scrapping due to lack of maintenance.

And yet, Odesa through its Maritime University and Naval Academy still graduates many professionals both for careers in the merchant navy and for shipping and logistics companies. An important asset for the future of Ukraine, which will be exploited to the fullest only thanks to a real maritime strategy.

Article by Ugo Poletti

Source: https://www.kyivpost.com/post/51751

The Odesa region presents a portfolio of investment projects across key sectors — from renewable energy and agriculture to manufacturing, culture, and medical infrastructure. These initiatives aim to promote sustainable community development, improve quality of life, and attract private capital for the reconstruction and modernization of southern Ukraine.

Read full Investment digest below

• EBRD deploys record amount of nearly €2.4 billion in Ukraine in 2024
• Bank has deployed nearly €6.2 billion in Ukraine since full-scale war began in 2022
• Across its regions, EBRD financing jumped to €16.6 billion from 2023’s record €13.1 billion

The EBRD prioritises support for energy security, vital infrastructure, food security, trade and the private sector in its work in Ukraine, counting both investments and trade finance in its deployed figure.

In 2024, the EBRD deployed a record €833 million of financing via partner financial institutions in Ukraine, including €472 million to support trade finance under its Trade Facilitation Programme. Portfolio risk sharing remained the main instrument for EBRD to deliver finance to Ukrainian businesses, with the EBRD remaining the leading provider of such guarantee facilities in the country.

The EBRD works with donors in Ukraine. Since 2022, the EBRD has succeeded in mobilising more than €2.6 billion in donor funds for Ukraine, including unfunded guarantees, of which nearly €1 billion was in 2024 alone. Leading donors since 2022 have been the European Union, United States of America, France, Norway and The Netherlands. In 2024, leading donors were the European Union, France, Norway, South Korea, Sweden and The Netherlands.

Following agreement in 2023 to increase the Bank’s paid-in capital by €4 billion to sustain support for Ukraine, the EBRD’s investment levels are expected to continue at around €1.5 billion a year, with potential for further increases when the time comes for reconstruction.

“Our shareholders have expressed enormous confidence in us by agreeing to a substantial capital increase for our activity in Ukraine and affected countries. I would like nothing more than for 2025 to be a year of reconstruction. This is where the EBRD can be at its best – using our financing knowledge and experience to build back better,” said EBRD President Odile Renaud-Basso.

Among highlights of EBRD work in Ukraine in 2024 were a highly innovative war risk insurance guarantee scheme designed to support trade despite the conflict; participation in a US$ 435 million telecoms deal that is bringing the country its biggest foreign direct investment in wartime; private-sector finance for postal services to Nova Post, pet food to Kormotech and bionic prosthetics to Esper Bionics; work on reintegrating war veterans into the economy, and major lending to the energy, infrastructure, banking and municipal sectors.

To mitigate the widespread electricity shortages Ukraine is experiencing as a result of Russian attacks on its power generation system, the EBRD focussed its energy investments on financing for decentralised small-scale generation capacity helping ensure uninterrupted energy supply to Ukrainian people and businesses.

EBRD energy financing has reached €2 billion since 2022, of which €639 million was signed last year.

The Bank lent €80 million to Ukrnafta, a Ukrainian state-owned oil and gas company, to finance supplying and installing a total of about 100 MW of small-scale gas-fired distributed power and co-generation capacities around the country and boost the resilience of the power sector.

The EBRD financed new players entering the energy generation market. A €180 million loan to Ukrainian Railways (Ukrzaliznytsia, or UZ) to install small-scale generators around the country, will finance the supply and installation of up to 270 MW of decentralised small-scale gas-fired power generation capacity.

Early in the year, the Bank also signed a €200 million loan package to Ukraine’s main hydropower generation company, Ukrhydrenergo, to mitigate the impact of repeated Russian attacks. An EBRD loan of €100 million backed by a concessional parallel loan of €100 million from Italy provided emergency support to restore and maintain the company’s electricity production.  

A parallel approach for supporting the nation’s energy resilience was through partnerships with Ukrainian financial institutions. The €700 million Energy Security Support Facility (ESSF), launched in September, was designed to support investments in decentralised energy generation, energy storage, and energy efficiency projects of Ukrainian businesses, regional municipalities and households. In the first three months since the launch of this programme, the EBRD signed or approved €525 million worth of financing agreements with four partner banks.

The heating needs of Ukrainian municipalities were prioritised in loans of €50 million to Kyiv, €25 million to Kharkiv, as well as municipal lending to the cities of Kryvyi Rih, Mykolaiv and Lutsk. These will be used to provide liquidity for municipal district heating as well as water treatment and transport utilities. 

With an eye to the country’s longer-term energy future, the EBRD also supported Ukraine’s ambitions for more renewable energy.

The Bank lent €60 million to fuel distributor Galnaftogaz for its first private biofuels investment in wartime, to support the domestic production of bioethanol, whose greenhouse gas emissions are 70 per cent lower than traditional fuel.

And it established a renewable energy joint venture with an experienced German solar energy company, GOLDBECK SOLAR Investment, to construct and operate new solar PV project in Ukraine.

In transport infrastructure, a separate €300 million loan to Ukrainian Railways will help the company upgrade its locomotives, to ensure stable and uninterrupted railway cargo operations for agricultural exports and critical imports as well as passenger services.

To improve road connections between Kyiv and its European Union neighbours, €267 million of an existing loan for road development was reallocated for emergency repairs on the M-06 road heading west to Slovakia and Hungary, which has experienced an upsurge in traffic in wartime.

Beyond financing, the EBRD continues to support Ukraine’s reform drive – a crucial step not only to unlock further investments from the private sector, but crucially, to progress on Ukraine’s aspiration to become an EU member.

Through the Ukraine Reform Architecture and the Business Ombudsman, the Bank has been working with government and public bodies on issues related to EU integration and alignment with EU regulation, while the digital procurement platform ProZorro has improved the transparency and efficiency of public procurement.  

The EBRD is also helping Ukraine prepare to effectively absorb the vast financing that reconstruction is expected to bring. Together with the European Investment Bank (EIB) and the World Bank, it is helping ministries and agencies build institutional capacity and providing technical assistance in the State Agency for Restoration and Infrastructure Development of Ukraine to establish an effective Project Delivery Unit.

The EBRD’s overall financing in 2024 reached a record level of €16.6 billion, a jump of 26 per cent from the previous record of €13.1 billion in 2023. The Bank’s financial results are expected to be announced in the spring.

Source: https://www.ebrd.com/home/news-and-events/news/2025/EBRD-deploys-record–2-4-billion-in-Ukraine-in-2024.html

Law of Ukraine “On Industrial Parks” and respective changes to the Tax Code (Law No. 2330-IX) and the Customs Code (Law No. 2331-IX) provide for the system of state incentives for investment parks. The following incentives are available for initiators of the creation of industrial parks, their management companies and participants:

• exemption from income tax for 10 years, subject to reinvestment in the development of the investment project;
• exemption from VAT on the import of new equipment for own use;
• the possibility of granting benefits for real estate taxation on the territory of industrial parks by decision of the local authority;
• exemption from import duty taxation of new equipment imported by participants of industrial parks for their own use.

The Ministry of Economy has developed respective by-laws for full launch of the system of state incentives for industrial parks.

For those who intend to take advantage of incentives for industrial parks, we suggest that you read the explanatory guide prepared by the UkraineInvest team.
 
The guide contains all necessary information about available incentives, requirements for industrial parks, procedures for inclusion in the register of industrial parks, selection of a management company, etc. It is updated considering amendments to the current legislation.

GUIDE: IMPLEMENTATION OF AN INVESTMENT PROJECT WITH SIGNIFICANT INVESTMENTS ON THE TERRITORY OF THE INDUSTRIAL PARK

GUIDE: INVESTMENT INCENTIVES FOR INDUSTRIAL PARKS

Source: https://ukraineinvest.gov.ua/en/analytics-research/guide-ind-parks/

1. Purpose of the Call

To support the implementation of the Ukraine Investment Framework (UIF), the optimal use of the available funds for priority projects and the participation of EU ¹ companies, the European Commission is launching a Call for Expressions of Interest from EU/EEA-based businesses to invest in Ukraine in line with EU strategic areas of interest and policy priorities.

The objective of this first Call for Expressions of Interest is to enter into dialogue with EU/EEA private companies on concrete investment opportunities and related constraints in Ukraine. Based on assessment criteria, subsequent contact with partner Financial Institutions may be facilitated for potential financial cooperation. This dialogue is aimed at building a pipeline of transformative private investments in Ukraine.

This first Call invites EU/EEA-based companies to submit project proposals for new investments into Ukraine’s real economy. Participation in this Call does not constitute any form of partnership, joint venture, or other legal relationship between the Participant and the European Commission. It does not constitute any guarantee of financial support neither from the European Commission nor any partner Financial Institutions. The publication of this Call for Expressions of Interest also does not commit the EU to finance the project investment proposal.

All project proposals presented to the European Commission will be assessed based on the criteria outlined in this Call and will be treated equally, ensuring a fair and transparent assessment process. All information submitted as part of the project proposal will be treated confidentially and used solely for the purposes of evaluating the proposals in accordance with the criteria specified in this Call.

The priority areas of the Call will be based on the Ukraine Plan and Strategic Orientations of the UIF, outlining key real economy sectors requiring Foreign Direct Investment (FDI) including:

• Energy: Develop distributed sustainable energy solutions, including renewable energy projects and modernisation of existing energy infrastructure.
• Critical Raw Materials: Invest in processing key minerals and resources needed for high-tech industries and renewable energy technologies.
• Processing industry and manufacturing: Revitalise and modernise manufacturing sector to boost industrial output and competitiveness.
• Construction materials: Support reconstruction and invest in construction material industry, design bureau, construction companies, supervisors, from housing to public buildings.
• Information technology and digital transformation: Strengthen digital infrastructure and technology to foster innovation and cross-sector efficiency.
• Transport and export logistics: Rebuild and modernise transport, logistics, and public infrastructure to support connectivity.

Eligibility Criteria

To ensure a structured and transparent assessment, the following criteria will be used for evaluating the eligibility of project proposals:

• Geographic Area: Ukraine (investment taking place on the territory of Ukraine).
• Private Sector: Eligible Participants to the Call shall be private enterprises, joint venture or consortium of companies, possessing a valid VAT registration number and Transparency registration number. Entities listed in the Early Detection and Exclusion System (EDES) ² data base are excluded from this Call for Expressions of Interest. If the project is conducted by a consortium, the consortium leader must be based in the EU or EEA.
• Nationality of Private Entity: EU/EEA-based businesses (companies possessing their real legal seat / legal incorporation in one of the EU Member States /EEA countries). For the avoidance of doubt, ‘real legal seat’ must be understood as the place where its managing board and central administration, or its principal place of business, are located.
• Alignment with Policy Priorities: Projects should focus on Ukraine’s real economy sectors and align with the priority areas outlined in the Ukraine Plan, which includes energy, critical raw material, manufacturing, digital and transport, among others.
• Minimum Investment Size: Projects must meet a specified minimum investment threshold, including a total size of the investment project at EUR 50 million and an own equity participation by the project promoter at 10% of the total value of the investment project.

Assessment Criteria

The following strategic, impact and financial criteria will be used to assess the project investment proposal:

Strategic Criteria

• Alignment with EU policy objectives and priority areas for investments in Ukraine.
• Ownership of the company in view to support EU open strategic autonomy.
• Compliance with EU standards and adherence to the Do No Significant Harm Principle.

Impact Criteria

• Impact of the project proposal on supporting EU strategic interests, including socio- economic development and green transition, taking into account risk assessment and mitigation measures.
• Replicability and scalability of the project proposal.
• Innovative features of the project proposal.
• Capacity of the Participant to mobilise private capital to finance the proposed investment (relevant experience in the specified sector, and particularly in Ukraine, will be regarded as an advantage).
• Market assessment and how the project proposal addresses market failures.

Financial Criteria

• Financial viability, including financial needs and investment plans reflecting the scale and scope of the project.
• Maturity of the proposal.
• Investment capacity: Participants must demonstrate that they can finance through equity at least 10% of the total cost of the project.

2. Submission of Projects

Interested companies are invited to submit their project proposals through the designated EU expressions of interest form through the EU Survey link below. Each proposal should include the following documents:

1. EU Transparency Register number and VAT.
2. A two-page project fiche to be uploaded by Participants in the EU Survey, detailing the key elements of the project, including the scope, objectives, timeline, investment size, impact and expected outcomes, innovation aspects, maturity of the project, risk assessment and mitigation measures, financial structure of the project proposal, alignment with EU priorities.
3. A document presenting the governance and detailing the ownership structure of the company, indicating the nationality of shareholders holding more than 10% (and of its consortium members, if any).
4. Any other relevant documents to ease the assessment of the project.
5. The Declaration on honour on exclusion criteria and selection criteria enclosed in the EU Survey.

Proposals, all correspondence, and documents related to this Call exchanged between Participants and DG NEAR must be written in English.

Supporting documents and printed literature furnished by the Participants may be in another official language of the EU, in which case accompanied with a legally valid translation into English.

3. Timeline

The Call has been announced at the EU-Ukraine Investment Conference on 13-14 November in Warsaw, Poland. The submission portal for this first Call for Expressions of Interest is open until 1st March 2025 00:00 – Brussels time.

Eligible Participants will receive feedback on the policy alignment of their proposal within 60 working days following the Call’s closing date. The European Commission will provide information about the outcome of the assessment process and may subsequently facilitate contact with partner Financial Institutions. Participants may submit requests for clarification regarding this Call for Expressions of Interest by 31^st of January 2024. DG

NEAR has no obligation to provide clarification on questions received after this date. Requests for clarification should be submitted in writing to:

Please ensure to refer to this Call in the subject of your request. Clarifications will be published on this EU Survey at the latest 10 days before the deadline for applications. The survey will be updated regularly, and it is the company’s responsibility to check for updates and modifications during this period.

Participants will be notified of the outcome of this assessment by e-mail. The notification will be sent to the e-mail address provided in the EU survey. It is the Participant’s responsibility to provide a valid e-mail address and to check it regularly.

4. Disclaimer

We recall that all documents in the possession of the Commission may be subject of a request for access to documents³. However, it is established practice to always consult the author document regarding the possibility of an eventual disclosure. DG NEAR may refuse to provide access to the submitted information, the disclosure of which would undermine the protection of commercial interests of the company, including intellectual property.

We encourage Participants to clearly mark and explain which information they consider confidential. Please note that general statements claiming confidentiality for the entire proposal or substantial parts of it will not be considered. The EU reserves the right to make its own assessment of the confidential nature of any information contained in the proposal, always after consultation with its author.

Personal data will be processed in accordance with the applicable data protection rules and the Privacy Statement, which is available in the EU Survey.

5. Ethics clauses and code of conduct

Participants must not be affected by any conflict of interest and must have no equivalent relation in that respect with other Participants or parties involved in the project. Participants and their personnel must comply with human rights as well as environmental legislation and core labour standards. Participants shall comply with all applicable laws and regulations and codes relating to anti-bribery and anti-corruption.

Source: https://enlargement.ec.europa.eu/european-neighbourhood-policy/countries-region/ukraine/ukraine-investment-framework/publication-call-expressions-interest-eueea-based-businesses-invest-ukraine_en#ref-1-purpose-of-the-call

As of December 31, 2024, Russia’s invasion of Ukraine continues to have profound physical, socioeconomic, and environmental impacts, which will be felt for generations. This fourth Rapid Damage and Needs Assessment (RDNA4) – undertaken jointly by the World Bank Group, the Government of Ukraine, the European Commission, and the United Nations, with support from other partners—takes stock of almost three years of the ongoing invasion, estimating damage.

Official version of document (may contain signatures, etc)

Official PDF

Source: https://documents.worldbank.org/en/publication/documents-reports/documentdetail/099022025114040022

Introduction

Ukraine’s construction industry has been significantly impacted over recent years for many reasons; the conflict with Russia, the Covid-19 pandemic, material shortages, price increases, and other political and economic global developments. However, with the latest press reports indicating potential peace developments in Ukraine, the focus has swiftly shifted back to the prospects of reconstructing the region.

In earlier ‘Rebuilding Ukraine Series’ was considered the potential approach and core issues connected to rebuilding Ukraine, including around procurement; core contract conditions; funding; insurance; and investment opportunities. This update examines Ukraine’s post-war construction opportunities, potential funding sources, and strategies for contractors and consultants involved in rebuilding efforts.

The scale of construction opportunities in Ukraine

The ongoing conflict in Ukraine has resulted in extensive damage to the country’s infrastructure, housing, and essential services. As the war continued, the need for future reconstruction became increasingly apparent and urgent.

According to UN News and a joint Rapid Damage and Needs Assessment (RDNA3) released by the Ukraine Government, European Commission, World Bank Group, and United Nations (UN), the total estimated cost of rebuilding Ukraine over the next decade, as of 31 December 2023, was calculated to be $486 billion. It is possible that this projected cost has since increased, given the previous year’s estimate was $411 billion (equivalent to €383 billion), and likely further exacerbated by inflationary issues.

The reconstruction of Ukraine presents real opportunities for businesses to secure contracts involving complex and prominent projects. Likely areas of future focus or project types may include:

• Transport and infrastructure reconstruction: restoring critical infrastructure like roads and bridges which are essential to the country’s transport links, recovery and economic activity.
• Housing projects: large-scale residential developments may be planned to accommodate displaced people and rebuild communities. A significant amount of housing stock has been destroyed or damaged due to the conflict and will need replacement. The housing and utilities sector accounts for 20% of the overall estimated reconstruction costs identified in the RDNA3. Reports indicate state support for household programs in the region this year, and regional banks have considered providing interest-free loans.
• Commercial and industrial rebuilding: there are opportunities in restoring manufacturing facilities, warehouses, and commercial hubs, as well as reviving activity and economic recovery. In terms of location, some new construction activities have continued in the Kyiv and Lviv regions, which have accessible local transport routes and larger populations.
• Energy: the destruction of the Kakhovka Dam and hydropower plant in 2023 was reported to have significantly harmed the environment, and worsened access to housing, food, and water[1]. The emphasis will be placed on opportunities related to general energy infrastructure, including power plants, cables and grids, as well as energy security, resilience, and access. In November 2024, Ukraine announced plans for the development of over 800MW of wind generation facilities during 2025. These types of initiatives are expected to contribute significantly to other reconstruction efforts.
• Green recovery and sustainable construction: there may be a greater focus on environmentally sustainable and resilient building practices, energy-efficient projects, and the integration of green technologies to future-proof the country and align with broader climate goals.
• Debris clearance and management, and demolition: a significant amount of costs have been estimated for actioning this across all sectors.

Whilst these types of projects and activities offer major opportunities for construction, engineering, and infrastructure businesses, they also pose potential challenges (as we will cover in future updates).

Opportunities for domestic and international construction companies

International partners, such as the World Bank, European Commission and UN, will be integral to supporting Ukraine’s future reconstruction efforts. These organisations offer support, financial assistance, technical expertise, and policy guidance to facilitate a systematic and effective recovery. The Ukrainian Government may also aim to attract private investments to expedite reconstruction efforts and advance the nation’s integration into the European Union (EU).

Government funding and incentives

At the Ukraine Reconstruction Conference held in London in June 2023, over 400 global companies committed to supporting the rebuilding of the country. Similar conferences have been held in Switzerland, Italy, France, Germany, and Poland. Additionally, there have been reports of the EU, UK, and US pledging significant financial contributions.

In November 2024, the EU launched a Call for Expression of Interest (Call) to mobilise private EU business to invest in critical areas to support Ukraine’s recovery and reconstruction[2]. This followed the European Commission’s earlier endorsement and communications from September 2024[3]. EU businesses, including consortia or joint ventures, involving EU and Ukrainian companies, were invited to submit their proposals by 1 March 2025. The proposals will be reviewed and matched with appropriate investment projects funded by the Ukraine Investment Framework, which is part of the EU’s €50 billion Ukraine Facility. This initiative aims to promote business partnerships and EU private sector involvement in Ukraine’s recovery and reconstruction, while also supporting Ukraine’s further integration into the EU Single Market.

The six priority areas outlined in the Call align with the Ukraine Plan and the Strategic Orientations of the Ukraine Investment Framework[4] (identifying key economic sectors requiring Foreign Direct Investment to facilitate Ukraine’s socio-economic recovery), including:

• Construction materials: supporting reconstruction activities by investing in the construction material industry, construction supervisors, and construction companies.
• Information technology and digital transformation: enhancing and strengthening technology and digital infrastructure to increase innovation and growth across a range of sectors.
• Energy: the development of sustainable energy solutions, encompassing renewable energy initiatives and the modernisation of existing energy infrastructure.
• Critical Raw Materials: focusing on investment and processing minerals and resources, including those required for high-tech industries and renewable energy technologies.
• Processing industry and manufacturing: updating the manufacturing sector and boosting competitiveness.
• Transport and export logistics: replacing and upgrading public infrastructure, transport, and logistics to support connectivity and mobility.

We plan to cover more about the Call, together with the eligibility criteria and other points to note in a forthcoming article in this series. We anticipate that there may be other initiatives or incentives for Ukrainian and foreign construction and engineering businesses to participate in the reconstruction process. Based on other post-conflict reconstruction efforts, examples of incentives could also extend to possible grants, tax breaks, etc.

Potential funding and players

UK

Earlier press reports suggest that UK funding will be made available to Ukraine. In 2024, the Department for Business and Trade released updated guidance on initiatives to boost UK-Ukraine trade, improve market conditions, and support Ukraine’s critical and long-term reconstruction[5]. By way of a similar example, construction industry press has previously highlighted the potential opportunities available to UK organisations in international recovery efforts, such as from the Iraq reconstruction budget in 2008. Reports at that time had indicated that British engineering expertise, particularly in the areas of energy, infrastructure, and public works, was highly sought in the region affected by conflict.

It is a frequent practice for the UK Government/public sector to conduct public procurement processes for the appointment of construction and engineering works, as well as other services and goods. If the UK Government is providing funding, it is likely that numerous Tier 1 and Tier 2 contractors and consultants will have a significant interest in these projects, particularly due to their familiarity with procurement procedures and their experience in post-conflict reconstruction efforts.

Whilst there will be opportunities for businesses to undertake and execute projects benefitting Ukraine and its citizens, such opportunities and contracts will entail certain risks. Additional concerns regarding future UK involvement may also link to the broader political, economic, and regulatory environment and approach to long-term commitment. Nevertheless, given that many larger UK contractors and consultancy firms already have a history of supporting post-conflict recovery efforts over several decades, including in Afghanistan, Iraq, and parts of Africa, they are particularly well-suited to contribute effectively to Ukraine.

Poland

Regarding local supply chain expertise and resources, there may be an increased demand for Polish contractors and consultants. Poland is anticipated to play a significant role in Ukraine’s reconstruction, particularly following the UN’s announcement of the establishment of a UN Office for Project Services, a special UN agency for reconstruction issues. It is presently unclear whether such businesses will act predominantly as main contractors, subcontractors/trade contractors or subconsultants, although the approach to procuring contracts and available funding or resources will inevitably influence this.

It is also notable that “Rebuild Ukraine,” an international exhibition and conference, has been scheduled for November 2025 in Warsaw[6].

US

Donald Trump has been reported to have actively engaged in recent discussions aimed at ending the conflict in Ukraine. We understand from press reports that he has held conversations with both Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy. Trump has conveyed optimism about the potential for resolving the conflict, suggesting that there is a possibility of achieving peace. Consequently, Trump’s recent involvement may accelerate the need for such reconstruction efforts and influence interest within the US to secure related contracts in Ukraine. There are some major global contractors and consultants with headquarters in North America and presence in Europe who might benefit from this approach.

Other funding sources?

During the conflict, political leaders and organisations appear to have proposed that reconstruction and recovery efforts should also be financed through the imposition of sanctions and the confiscation of frozen Russian assets. The extent to whether such funding is feasible and the contribution this would provide in practice is yet to be confirmed.

Other considerations

In our next update we will consider the potential risks and challenges contractors/subcontractors and consultants should have in mind when tendering or negotiating future contracts for projects in Ukraine. We will also touch on how the future of construction law may evolve as a result of the efforts to rebuild.

Concluding thoughts

The urgent and extensive rebuilding efforts in Ukraine will inevitably present businesses in the construction, engineering, and infrastructure sectors with unique and significant opportunities to secure lucrative contracts on high-profile projects. It is crucial for businesses to be aware of the opportunities available, as well as the associated risks and impact of legal and regulatory frameworks.

Source: https://www.lexology.com/library/detail.aspx?g=58816c47-ffc9-44af-9731-9abc70a8d301&utm_source=lexology+daily+newsfeed&utm_medium=html+email&utm_campaign=lexology+subscriber+daily+feed&utm_content=lexology+daily+newsfeed+2025-02-25&utm_term=

Ukraine’s evolving market offers a wide spectrum of opportunities for foreign investors, but choosing the right city can be as critical as selecting the right industry

From thriving tech hubs to industrial powerhouses, each major urban center has its unique strengths—often proven by the success of top international companies already operating there. This guide provides a comparative overview to help you decide where to establish your business in Ukraine in 2025.

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Kyiv: The Corporate and Financial Epicenter

Primary Industries: Finance, Consultancy, Consumer Goods, Corporate Headquarters
Why Kyiv?

• Proximity to Government Institutions: As Ukraine’s capital, Kyiv houses key regulatory bodies and ministry offices, making it ideal for ventures requiring frequent official engagements (e.g., finance, legal, and consulting firms).
• International Companies in Kyiv:
  • Procter & Gamble (P&G): Leverages Kyiv’s consumer market and robust distribution channels.
  • Ernst & Young (EY): Manages audit and advisory services for local and multinational clients.
• Who Should Locate Here:
  • Corporations seeking a strategic command center for national operations.
  • Consultancy, banking, and consumer goods firms that benefit from direct access to governmental and corporate clients.

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Lviv: The IT and Creative Hub

Primary Industries: IT Outsourcing, Software Development, Creative Services
Why Lviv?

• Tech Ecosystem: Renowned for tech talent and startup culture, supported by universities focusing on computer science and engineering.
• European Orientation: Its western location and cultural ties facilitate collaboration with EU partners, especially in nearshoring models.
• International Companies in Lviv:
  • GlobalLogic and N-iX: Serve global tech clients, demonstrating Lviv’s capacity for high-end software projects.
  • EPAM Systems: A major IT services provider capitalizing on local engineering talent.
• Who Should Locate Here:
  • Startups seeking top-tier developers at competitive costs.
  • Creative agencies, design studios, and any enterprise wanting swift access to European markets.

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Kharkiv: Engineering, R&D, and Advanced Manufacturing

Primary Industries: Engineering, Aerospace, Scientific Research, IT
Why Kharkiv?

• Academic Excellence: Home to multiple technical universities and research institutes, fueling a strong pipeline of engineers and scientists.
• Industrial Legacy: Kharkiv has a long history in machinery, aerospace, and defense, making it a prime location for advanced manufacturing.
• International Companies in Kharkiv:
  • Siemens: Implements large-scale infrastructure and industrial automation solutions.
  • International IT Firms: Outsourcing and R&D centers focusing on complex software and hardware projects.
• Who Should Locate Here:
  • Businesses that rely on specialized R&D or require a steady stream of engineering talent.
  • Tech-driven companies needing advanced prototyping or product testing facilities.

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Dnipro: The Industrial and High-Tech Manufacturing Powerhouse

Primary Industries: Heavy Manufacturing, Metallurgy, Electronics Assembly, Industrial Tech
Why Dnipro?

• Robust Infrastructure: Historically an industrial heartland, Dnipro’s industrial parks and logistic networks cater to large-scale production.
• Skilled Workforce: Local technical institutions produce engineers and technicians adept at managing complex assembly lines.
• International Companies in Dnipro:
  • Jabil: Specializing in electronics manufacturing services, taking advantage of efficient local supply chains.
  • ArcelorMittal (nearby in Kryvyi Rih): Although based in another city, the general region exemplifies foreign investment in steel and heavy industry.
• Who Should Locate Here:
  • Export-driven manufacturing entities needing streamlined logistics.
  • Companies focusing on industrial tech solutions, machinery, or automotive components.

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Odesa: The Logistics and Trade Gateway

Primary Industries: Maritime Logistics, Trade, Export-Import, Tourism
Why Odesa?

• Strategic Port: Odesa’s Black Sea port is one of the largest in the region, essential for import-export businesses.
• International Trade Links: Ideal for companies dealing in agricultural exports or consumer goods distribution.
• International Companies in Odesa:
  • Cargill: Invests in grain terminals and partners with local producers to tap global markets.
  • Shipping & Maritime Service Providers: European and Asian logistics companies leverage the port for cross-continental trade.
• Who Should Locate Here:
  • Businesses requiring quick and cost-effective international shipping routes.
  • Hospitality ventures seeking to capitalize on the city’s strong tourism appeal.

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Matching Your Industry to the Right City

City	Industries	Foreign Players	Ideal For
Kyiv	Finance, Consultancy, HQs	Procter & Gamble, EY, KPMG	Corporate HQs, consumer goods, professional services
Lviv	IT, Creative Services	GlobalLogic, N-iX, EPAM	Tech startups, nearshoring, creative & design agencies
Kharkiv	Engineering, R&D, Advanced Manufacturing	Siemens, Various IT R&D centers	Aerospace, specialized engineering, complex product development
Dnipro	Industrial Tech, Electronics, Metallurgy	Jabil, ArcelorMittal (regionally)	Export-oriented manufacturing, industrial automation
Odesa	Logistics, Trade, Maritime	Cargill, Numerous shipping firms	Import-export businesses, tourism, shipping & distribution

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Considerations for Starting Business in Ukraine by Location

1. Local Labor Market
   • Kyiv: Access to a broad range of talent, albeit with higher salary expectations.
   • Lviv & Kharkiv: Specialized IT and engineering skill sets at competitive costs.
   • Dnipro & Odesa: Strong workforce for manufacturing and logistics but may require sector-specific training.
2. Infrastructure & Connectivity
   • Kyiv & Lviv: Well-developed road and rail systems plus air connectivity.
   • Dnipro: Industrial transport networks and cargo-friendly railway lines.
   • Odesa: Direct port access crucial for global trade.
3. Operational Costs
   • Kyiv: Higher office and living expenses but excellent networking potential.
   • Regional Cities: Typically lower real estate and labor costs, though sector-specific fees (e.g., shipping costs in Odesa) should be factored in.
4. Local Incentives
   • Industrial Parks & Special Economic Zones: In cities like Dnipro, offering tax breaks or simplified customs procedures.
   • Tech Clusters: Lviv and Kharkiv often have supportive startup ecosystems with coworking spaces and incubators.
5. Market Access & Networking
   • Kyiv: Corporations, government agencies, and financial institutions.
   • Regional Hubs: Industry-focused communities, local business associations, and academic partnerships.

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Conclusion

Choosing the best Ukrainian city to establish your business in 2025 depends largely on your industry focus and growth strategy. Kyiv remains a prime choice for corporate headquarters and financial services, while Lviv stands out for tech and creative endeavors. Kharkiv offers unmatched engineering and R&D potential, whereas Dnipro excels at industrial-scale manufacturing. Odesa, on the other hand, is the go-to location for maritime logistics and trading.

By aligning your operational needs with each city’s established strengths—and taking cues from the top foreign companies succeeding there—you can make an informed decision that sets your venture up for sustainable growth in Ukraine’s evolving economic landscape.

Source: https://good-time-invest.com/blog/where-to-start-a-business-in-ukraine-in-2025-a-city-by-city-overview/