The European Bank for Reconstruction and Development (EBRD) invested 1.1 billion euros in Ukraine in 2019, the bank reported on Jan. 16.
EBRD investments in 51 private and public sector projects in the country over the past year make Ukraine the second largest recipient of the bank’s loans after Kazakhstan.
Ukraine also represents the largest number of EBRD transactions in a single country, with this 1.1 billion euro loan adding to the 16 billion euros that the organization has invested in Ukraine since 1993.
Over the years, the bank has given loans to 460 Ukrainian projects across industries including banking, agriculture and pharmaceuticals.
Public investments
The EBRD’s rationale for public sector investment is “creating conditions for the development of the private sector,” EBRD head in Eastern Europe and the Caucasus Matteo Patrone told the Kyiv Post back in February 2019, when he was newly appointed as the bank’s head.
Now a year after his appointment, it seems he told the truth: The EBRD financed small and medium-sized enterprises in Ukraine worth up to $23 million, with $1.3 million allocated to 160 consultancy projects in this sector, making it a strategic priority for the bank in 2019.
Apart from that, the EBRD also launched the EU4Business-EBRD Credit Line in conjunction with the European Union as well as a local currency-lending program to secure trade benefits with the EU through the Deep and Comprehensive Free Trade Agreement, which the EU and Ukraine signed in 2017.
Boosting the energy sector
The bank also handed over management of the New Safe Confinement in Chernobyl to Ukrainian authorities, marking the completion of the largest-ever international cooperation in nuclear safety.
The development of renewable power generation was a key priority for the bank in 2019, with $390 million invested throughout the year.
The EBRD also made a major investment of $165 million in the power transmission system last year, helping Ukrenergo, which controls Ukraine’s transmission of electricity from generators to distribution networks. Its goal was to start upgrading its infrastructure to align with the European electricity networks standards.
Another $166 million EBRD loan co-financed the construction of a 250-megawat windfarm in Kherson Oblast in southern Ukraine, and new energy efficient and ecologically friendly, low-floor trolleybuses were delivered to the cities of Kharkiv, Lviv and Poltava thanks to the bank’s $277 million Ukraine Public Transport Framework II program.
Other investments
The bank extended loans to Kronospan UA, a manufacturer of wood-based panels, for the construction of a new facility in Novovolynsk, located near the Polish border, 500 kilometers from Kyiv.
It also gave money to Unigran Group, a leading Ukrainian mining company producing and selling granite products, construction materials and explosives to buy new railcars and trucks.
In the domestic pharmaceutical sector, the bank invested $16 million in Farmak and $27 million to Yuria-Pharm to provide small doses of cancer treatment to Ukrainian patients.
Meanwhile, the agriculture industry remains the bank’s top priority in Ukraine.
The bank claims its $48 million loan to Kernel Group and $12.5 million to Nyva Group helped the industry leaders improve renewable energy generation and waste management.
“The EBRD is once again leading by example and assisting Ukraine in the areas where its resources and skills are needed most,” Patrone said in a statement on Jan. 16.
The EBRD head pledges to push Ukraine’s political leaders to make Ukraine a more attractive place for foreign investment, promoting privatization and improved governance of state-owned firms.
