PM: Ukraine’s reconstruction cost estimated at $1 trillion

Ukrainian Prime Minister Denys Shmyhal announced that the cost of rebuilding Ukraine has reached $1 trillion, almost twice the amount he projected six months ago.

The reconstruction and modernisation of the country will require this funding over a period of 14 years, Shmyhal wrote on Telegram, Caliber.Az reports. 

Six months prior, on February 24, during a joint meeting of the Ukrainian government and the European Commission, Shmyhal had estimated that the country’s future recovery would cost around 500 billion euros. This figure has now nearly doubled.

To manage funding on such a large scale, Shmyhal proposed the establishment of two new financial mechanisms: the "Ukraine Fund," which would hold $540 billion, and the "European Structural Fund in Support of Ukraine," estimated at $460 billion.

Both funds are expected to be financed by Western countries, with the European Structural Fund serving as a platform for investment from the European private sector into Ukrainian production.

At the ministerial-level meeting of the Ukrainian Donor Platform within the URC-2025 framework, Shmyhal outlined the concept behind the two funds.

The "Ukraine Fund," aligning with World Bank estimates, would cover the cost of reconstruction and be financed through confiscated Russian assets and a special tax on the export of Russian raw materials.

The second fund aims to attract European private sector investments in Ukrainian industry.

Furthermore, Shmyhal highlighted two strategic priorities for Ukraine going forward: to maintain and strengthen sanctions pressure on Russia, and to secure sufficient financial resources to enable Ukraine to withstand ongoing Russian aggression and its related challenges.

By Sabina Mammadli