On 15 March 2023, the Danish Government, together with a broad majority of the Folketing have entered into an agreement to establish a Fund in support of Ukraine which should coordinate Denmark’s wide-ranging efforts aimed at broad and long-term support for Ukraine in the military, humanitarian and economic spheres. Thus, Denmark intends to remain among the countries that provide the largest financial assistance to Ukraine, measured as a percentage of GDP.
The Fund consists of three components which have already received funding for 2023:
The official presentation of the Fund took place at the residence of the Prime Minister of Denmark in Marienborg with the participation of members of the Danish Government – Minister for Foreign Affairs Lars Løkke Rasmussen, Acting Minister for Defence Troels Lund Poulsen, Minister for Industry, Business and Financial Affairs Morten Bødskov, Minister for Development Cooperation and Global Climate Policy Dan Jannik Jørgensen, as well as Ambassador of Ukraine to Denmark Mykhailo Vydoinyk.
According to Prime Minister of Denmark Mette Frederiksen, the outcome of the ongoing war will decide the fate not only of Ukraine, but also of the whole of Europe, so there is a great and urgent need for additional assistance.
The Fund will finance the transfer of “Caesar” howitzers and “Leopard 1” tanks to Ukraine, which was announced in January. In addition, Ukraine will receive already the ninth package of weapons in the amount of 1 billion DKK ($142 million) which will particularly include ammunition, heavy machine guns and other military equipment requested by Ukraine, including for demining.
Thus, the total amount of military support provided by the Danish to Ukraine side since the beginning of the full-scale war with Russia is estimated at 4.2 billion DKK ($600 million). The Fund also provides resources for 2024-2027 for the possible replacement and re-purchase of military vehicles and equipment transferred in 2022-2023.
Danish Foreign Minister Lars Løkke Rasmussen emphasized the importance that the Fund will include trade support to improve the conditions for risky investments in Ukraine, which could become one of Denmark’s biggest export markets in the future.
In particular, it is planned to create a new state loan and guarantee scheme by the Denmark’s Export and Investment Fund in the amount of 1 billion DKK ($142 million), aimed at the reconstruction of Ukraine′s critical infrastructure. In addition, the Ukrainian Investment Forum will be established to act as a facilitator in identifying potential reconstruction projects in Ukraine.
Greater efforts by Danish business and reconstruction can help Ukraine achieve growth and long-term development again, as well as support its European ambitions, noted Lars Løkke Rasmussen.
Starting from 2024, the funds for the Ukraine Fund will be allocated by the Danish Finance Act consistent with defence spending, and both business structures and charitable foundations may become its sponsors, along with the Danish government.