On the 197th day of the war, on 8 September 2022, Ambassador of Ukraine to Denmark Mykhailo Vydoinyk took part as a speaker in a conference on the topic “How do we pay for the Reconstruction of Ukraine – is common debt (part of) the answer?”. The event was organized by the Danish policy centre “Think Tank Europa”, the German Marshall Fund and the Danish Society of Engineers.
The participants of the conference agreed that currently frozen Russian sovereign assets, multiannual financial programs of multilateral development banks, or some other avenues of war reparations could be used to rebuild Ukraine. However, the main question is whether the EU will be able to allocate hundreds of billions of euros to this effort over the coming years.
According to the representative of the German Marshall Fund Jacob Funk Kirkegaard, fast and effective support for Ukraine is not charity, but the strategic interest of European countries. The Fund estimates that the size of the financial support package for the reconstruction of Ukraine will reach between 100 and 750 billion euros over a ten-year period with a mix of loans and grants.
The conference participants concluded that while some financial support can be expected from the international community, most of the reconstruction burden is expected to fall on the EU, which will finance Ukraine’s reconstruction and EU accession process. It was proposed to consider issuing new common debt in the EU, as was done during the coronavirus crisis, in order to distribute debt among all EU members and finance their economic recovery.
The main speech at the conference was made by the Deputy Minister of Economy and Innovation of Lithuania Vincas Jurgutis who noted the need for “de-Sovietization” of Ukraine in the process of recovery. According to him, “It is not only about new infrastructure but about modernisation of the country, about economical recovery, economical reforms, new experience that can be transferred to Ukraine.”
According to the Ambassador of Ukraine, despite the complexity and high cost of reconstruction, it will be beneficial for European states, since most of the funds will be directed to European companies that will supply their products to Ukraine. “The reconstruction of Ukraine can become a new driving force for the faster development of your countries,” Mykhailo Vydoinyk said.