EIB Group Allocates Over €450 Million to Fortify Ukrainian Energy Infrastructure and Boost Business Support

EIB Group Allocates Over €450 Million to Fortify Ukrainian Energy Infrastructure and Boost Business Support

(IN BRIEF) The European Investment Bank (EIB) Group has committed over €450 million to support Ukraine’s energy infrastructure ahead of the upcoming winter, including funding for the reconstruction of hydropower plants, electricity grid repairs, and district heating network restoration. Additionally, the EIB announced initiatives to enhance local-currency lending and provide guarantees to facilitate financing for Ukrainian businesses. The European Investment Fund (EIF) will roll out a €300 million export-credit guarantee to support EU companies trading with Ukraine. EIB Group President Nadia Calviño briefed EU foreign ministers on these measures, emphasizing the importance of economic resilience and the reconstruction of Ukraine. The EIB Group’s business support includes €110 million in new lending for Ukrainian MSMEs through partial portfolio guarantees and a €150 million revolving credit facility in local currency.

(PRESS RELEASE) LUXEMBOURG, 22-Jul-2024 — /EuropaWire/ — The European Investment Bank (EIB), the lending arm of the European Union, has announced a substantial commitment to support Ukraine’s energy infrastructure with over €450 million in funding, essential for the upcoming winter season. Additionally, a new initiative has been introduced to enhance local-currency lending and EIB guarantees, facilitating financing access for Ukrainian businesses. The European Investment Fund (EIF) will also implement a €300 million export-credit guarantee this month to assist EU companies trading with Ukraine.

In a briefing to European Union foreign ministers in Brussels, EIB Group President Nadia Calviño detailed the latest support measures aimed at bolstering Ukraine’s economy. These measures include loans totaling €450 million for Ukrainian energy projects, focusing on the reconstruction of hydropower plants and electricity grid infrastructure damaged by Russian attacks, and the restoration of district heating networks in Ukrainian cities. An additional €86 million is allocated to Ukraine’s national grid operator, Ukrenergo, for constructing anti-drone shelters for power stations, enhancing the resilience of the energy system for the coming heating season.

“We are stepping up our support to help shield and repair Ukraine’s infrastructure ahead of the winter,” said President Calviño. “I am also informing ministers about our steadfast support to Ukrainian businesses. Economic resilience is key to the reconstruction enabling the country’s rebuilding”.

President Calviño also held a videoconference with Ukrainian Finance Minister Sergii Marchenko to discuss progress in ongoing projects, particularly those related to energy infrastructure. This was followed by a working lunch with EU foreign ministers at the Foreign Affairs Council in Brussels.

Business Support

As part of the new support package, the EIB Group has approved three partial portfolio guarantees, expected to generate over €110 million in new lending for Ukrainian micro, small, and medium-sized enterprises (MSMEs) through three Ukrainian banks. These guarantees, set to be signed in the latter half of 2024, will support 550 Ukrainian companies, sustaining approximately 8,250 jobs. The EIB Group also plans to provide partial portfolio guarantees to five additional Ukrainian banks by year-end under the EU4Business Guarantee Facility.

Furthermore, the EIB is collaborating with UKRSIBBANK, a BNP Paribas Group subsidiary, to establish a revolving credit facility of at least €150 million in Ukrainian hryvnia to support war-affected businesses. This facility is expected to be operational by the end of 2024, marking the EIB’s second local-currency lending initiative in Ukraine following a partnership with Citibank Ukraine valued between $50 million and $100 million in Ukrainian hryvnia.

Additionally, the EIF will launch a Call for Expressions of Interest by the end of the month for a €300 million export-credit guarantee facility to support EU companies trading with Ukraine. This initiative, following an agreement with the European Commission in June and backed by the InvestEU programme, aims to rejuvenate EU-Ukraine trade and strengthen the Ukrainian economy by offering guarantees to export-credit agencies in EU Member States, Norway, and Iceland.

Media contacts:

Olga Sushytska
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Nikos Chrysoloras
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+352 4379-83078

Monica Faro
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+352 4379-71105

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SOURCE: European Investment Bank