It would cost almost half-a-trillion dollars to reconstruct Ukraine
A coalition of investors, with support from BlackRock $BLK and JPMorgan $JPM, are aiming to put together $15 billion in aid to rebuild Ukraine. In a new group known as the Ukraine Development Fund, they are supporting investments from state bodies and capital markets; the fund will bring together a consortium of investors to finance at least $15 billion of reconstruction work in the country after two years of Russian invasion.
The Financial Markets Advisory Group of BlackRock has five members working on the fund, along with JPMorgan Chase staff members. Both institutions are providing their services for free.
Last month, the World Bank and other organizations estimated the total cost of rebuilding Ukraine after Russia’s invasion at almost $500 billion. In an interview with Bloomberg, Philipp Hildebrand, vice chairman of BlackRock Inc., said the Ukraine Development Fund is poised to secure at least $500 million from countries, development banks, and other grant providers.
Two years have passed since Russia invaded Ukraine. But in its pursuit, Russia has so far failed to capture Ukrainian capital Kyiv or take control of its government. The war, however, has destroyed the country and taken the lives of 31,000 Ukrainian soldiers.
The Ukraine Development Fund, according to Hildebrand, is likely to be incorporated in Luxembourg with a committee for investment, analysts and researchers.
The Ukraine Development Fund will be one of the biggest public-private collaborations, comparable to Germany’s KfW (a leading development bank in Germany) after World War II, or BlackRock’s Climate Finance Partnership with several governments, said Hildebrand. The funding will focus on manufacturing, infrastructure, agriculture, and energy. For that, about 20 viable projects have been identified.
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