Table of Contents
- The Reporter's Notepad. Exclusive reporting, observations from interviews and conversations with sources, plus the most comprehensive Meeting Notes you'll likely ever see.
- Just The Facts. All the news fit to read on the reconstruction of Ukraine, verified and originally reported by The RUB staff, unless otherwise attributed.
- Here's What They Think. Summaries of new opinion pieces from influential media outlets, pundits and intellectuals around the world.
- The Sober Second Thought. Reporting on the newest academic and think tank studies related to the reconstruction of Ukraine.
- The Rebuilder's Social. Important, influential or particularly insightful social media posts that illuminate the mood and plans of Ukraine and the rebuilders.
Exclusive
Dear URN Daily subscribers,
Here's the follow up to our exclusive interview with Finnfund investment director Hanna Loikkanen. But don't forget to scroll all the way down for the latest news, studies, social media posts and more on the reconstruction of Ukraine.
Finnfund's quest for viable investments in Ukraine spotlights issues facing DFIs amid war
Finnfund, like many development finance institutions, faces a long series of challenges in finding enough viable investment opportunities in Ukraine amid the ongoing war.
A high minimum investment size, strict ESG criteria, the continued presence of oligarchs, and a hesitance on the part of Finnish investors to enter Ukraine during the war are impeding swift investment, said Finnfund investment director Hanna Loikkanen.
"Regardless of how hard we try, I don't really think that we are going to be able to find a lot of bankable and investable investments," Loikkanen said in an interview with Ukraine Rebuild Newswire. "We have struggled in identifying such."
Since receiving a €25 million allocation from the Finnish government early this year, Finnfund has been constantly seeking viable investment opportunities, approaching associations, companies, groups, experts and virtually anybody else who might help them track down a lead.
"We have been reaching out to the Ukraine investment association, the Ukraine league of industrialists, and I have my contacts from my previous life with all the local banks and investment banks and investment advisors," she said.
"And on this end, we've been reaching out to the Finnish companies and all the Finnish industrial associations and the Chamber of Commerce and all those places where you would be able to find potential projects to invest in."
Like most development finance institutions, the issues Finnfund is dealing with stem from strict investment criteria, particularly related to ESG issues, as well as the need to benefit multiple parties at once: create local jobs, benefit local businesses and help investors in the home nation while dealing with local political realities.
In Ukraine's case, the most obvious problem, of course, is the war. Finnfund's €25 million, besides benefiting Ukrainians, is also supposed to benefit Finnish investors or experts, but few private companies are willing to enter Ukraine when it's still at war.
"Many companies are very keen and looking at the opportunities but they're still very hesitant in actually taking the chance," she said. "Last year at the Ukraine rebuilding conference in Warsaw there were, I think, 80 Finnish companies, but to get them to actually step over the border and find business opportunities is the challenge."
"So we are talking about at minimum a few million euros and up per investment"
The larger Finnish companies have also been set back by the long-standing practice of letting their Moscow offices run their Ukraine operations. When Russia invaded and Finnish companies pulled out of Russia, they also lost their expertise in Ukraine.
Another problem, she said, is that the minimum investment Finnfund can make is just too high for many of the viable opportunities it does find. Finnfund expects to spread out the €25 million allocation, which the institution received early this year, over four or five separate investments.
"So we are talking about at minimum a few million euros and up per investment," she said. "A number of cases do not fit into that ticket size. We're not looking ourselves to do smaller investments," she said. "We simply cannot. This machine has not been built for that purpose and those processes."
She said the institution has been seeking ways to skirt the problem, for example by having a local operator aggregate several investments into one opportunity, but has so far had no luck.
Yet another major issue is that, like other development finance institutions, Finnfund is limited to private sector companies, while state companies in Ukraine are the one most able to take the risk of operating in wartime.
"This means that 60% to 70% of all the counterparties and the project today are out of our investment mandate," she said.
"There's still quite a lot of oligarch-owned large companies in Ukraine that are, for KYC and compliance reasons, out of our investable universe"
Among the private companies that do operate in Ukraine, the presence of oligarchs - much diminished since the start of the war but still influential - makes the mission more difficult.
"There's still quite a lot of oligarch-owned large companies in Ukraine that are, for KYC and compliance reasons, out of our investable universe," she said.
Finnfund is also required to invest the money directly, voiding many of the remaining opportunities such as lending to banks and investing in funds. And then there's the capital constraints put in place by the National Bank of Ukraine and many other challenges.
Despite them, Finnfund believes it's close to signing its first deal under the €25 million allocation.
First investment coming soon
As reported last week by Ukraine Rebuild Newswire, Finnfund expects to invest between €5 million and €10 million of the allocation as early as this quarter, or possibly in Q1 of 2025, in an agri-processing company in western Ukraine.
"We are also reaching out to those sectors in Finnish business that we believe would be interested - the construction sector and anything to do with construction materials and rebuilding," said Loikkanen. "We are also discussing digital infrastructure with potential Finnish partners and counterparties."
While Finnfund is struggling with a wide variety of challenges, one change will eventually make the whole process of investing a lot easier: the end of the war.
"When the war ends and there's a massive reconstruction, we most likely will be able to be lending also to banks and through banks if our state allows, and then locally invest into reconstruction," she said.
"I could see that Finnish companies, by that time, will understand what a massive opportunity this is as well."
The Damage
- Reporters without Borders calls for $96 million fund to 'rebuild media landscape' in Ukraine
- Ukraine has rebuilt 887 medical facilities since 2022 invasion, Health Ministry says
The investments
- Ukraine's GDP warrant holders choose PJT as advisor ahead of potential restructuring, sources tell Bloomberg
- Ukraine to save up to $700 million due to change in IMF's 'surcharge' policy, official says
- Italian construction firm Buzzi completes sale of Ukraine cement assets to CRH
Peace and War
- Zelensky to present 'victory plan' to Ukrainian lawmakers on Oct. 16
- Zelensky says he was briefed on 'actual involvement' of North Korea in the war
- Russia's push to capture Pokrovsk coal mine could wipe out two-thirds of Ukraine's steel production, executives warn
- EU, IOM launch €6 million program of skills training, business grants for Ukraine veterans
- The Conversation: Ukraine faces difficulties on battlefield, diplomatic front after Ramstein meeting delay
- YouTube influencers, Telegram replace traditional media as top news source in Ukraine since invasion, RSF study shows
- KSE Institute recommends insurance requirement to curb growth of Russia's 'shadow fleet' of oil tankers
The Damage
Reporters without Borders calls for $96 million fund to 'rebuild media landscape' in Ukraine
Reporters without Borders has called for creation of a $96 million fund to "rebuild the media landscape" in Ukraine after the Russian invasion caused a 61% drop in ad revenue and prompted the closure of at least 235 media outlets.
A report by the Paris-based NGO, together with media analysis firm The Fix, also found that media operating costs have risen by 24%, labor has become scarce as many journalists joined the army or fled the country. Also, at least 12 media workers have been killed, 43 injured and 20 are held prisoner, it said.
At the same time, the Ukrainian government has ramped up pressure on the local media to toe the government line, 'information deserts have spread, and disinformation has proliferated,' the report said.
"By studying the budgets of 42 media outlets and analyzing the media sector's overall economic situation, the report found that $96 million is needed over three years to ensure that independent Ukrainian media outlets can cover their operating expenses and administrative costs," the report concludes.
The report proposes the creation of an International Fund for the Reconstruction of the Ukrainian Media (IFRUM), which would be run by an independent ad hoc committee and dispense aid on the condition of ethical behavior by the media outlets.
It also called on the Ukrainian government to "adopt a series of targeted measures" to encourage the media to resume long-term investments, halt political pressure on the media, and set up a regulatory framework to counter disinformation.
"Deprived of stable sources of income – from advertising to subscriptions – many Ukrainian media outlets have lost their financial autonomy and are dependent on economic aid from donors, which is waning," the report states. "While 70% of local media were more than 90% self-sufficient in 2021, only 14% declared a similar level of self-sufficiency in 2023."
Ukraine has rebuilt 887 medical facilities since 2022 invasion, Health Ministry says
The Ukrainian government has rebuilt 887 medical facilities, or almost half of the facilities destroyed since the 2022 Russian invasion, the Health Ministry said.
Of the facilities rebuilt, 537 were fully restored and 350 were partially restored after suffering comparatively minor damage, such as shattered windows and collapsed roofing, the ministry said in a communique on Monday.
Since February 2022, 1,673 medical facilities have been damaged and 223 have been destroyed, the ministry said. At the same time, Russian forces have damaged 226 ambulances, destroyed 263 and seized 125.
The damage has been most severe in the regions of Mykolaiv, Dnipropetrovsk, Kyiv, Kharkiv and Chernihiv, according to the ministry.
The investments
Ukraine's GDP warrant holders choose PJT as advisor ahead of potential restructuring, sources tell Bloomberg
A group of investors in Ukraine's GDP warrants has appointed US-based investment bank PJT Partners as their financial adviser ahead of a potential restructuring, unnamed people familiar with the matter told Bloomberg.
The investor group, which includes funds such as Aurelius Capital Management and VR Capital Group, is also being advised by US law firm Cleary Gottlieb Steen & Hamilton, Bloomberg reported earlier.
The group, which holds more than a quarter of the $2.6 billion warrants issued, was formed in response to Ukraine's decision this year to suspend payments on the warrants starting May 2025, the sources said.
The warrants were not included in a $20 billion debt restructuring agreement for Ukraine's bonds that was approved by private creditors in August, the report said.
The warrants include disbursements tied to Ukraine's economic performance, providing creditors with payments if gross domestic product expansion exceeds certain levels.
They were issued as a sweetener during a previous debt revamp in 2015 and will mature in 2041.
In the wake of Russia's full-scale invasion of Ukraine in 2022, the warrant holders agreed to a two-year moratorium and changes on coupon payments, as well as a call option that expires on July 2027.
Ukraine to save up to $700 million due to change in IMF's 'surcharge' policy, official says
Ukraine will save up to $700 million over the next five years after the International Monetary Fund decided to lower its "surcharges," or fees charged to the most indebted nations on top of regular interest payments, Alternative Executive Director at the IMF Vladyslav Rashkovan said.
"Our total annual spending for using IMF resources will be reduced by somewhere around $130 million," Rashkovan said in a post on Facebook on Monday. "Taking into account the future IMF tranches under the current program, the effect for the next 5 years is $650 million-700 million."
When announcing the changes on Oct. 11, IMF Managing Director Kristalina Georgieva said the change in the "surcharge policy" will lower borrowing costs by 36%, saving debtors a combined $1.2 billion per year. Some 20 nations currently pay the surcharges, including Ukraine.
Rashkovan noted that for Ukraine, the commission reduction stands at about 38-39%, adding that the base lending rate will soon begin to drop rapidly as central banks lower their key rates, which may result in further reduction of Ukraine's borrowing costs.
Italian construction firm Buzzi completes sale of Ukraine cement assets to CRH
Italian construction firm Buzzi said it has completed a sale of its assets in Ukraine to Irish CRH, after it received approval from Ukraine's competition authority in September.
The agreement for the sale, worth €100 million, was signed in June 2023, Buzzi said Monday in a press release.
Buzzi's assets in Ukraine include two cement plants and two distribution terminals, along with ready-mix concrete plants in three cities.
Under the terms approved by Ukraine's Antimonopoly Committee last month, CRH must sell a 25-28% stake in the unit to an independent investor within nine months.
CRH already owned three plants in Ukraine under the Cemark brand.
Peace and War
Zelensky to present 'victory plan' to Ukrainian lawmakers on Oct. 16
Ukrainian President Volodymyr Zelensky will present his government's "victory plan" to end the war with Russia to lawmakers on Oct. 16, an advisor said on Monday.
"On Wednesday, Oct. 16, President Volodymyr Zelensky will speak in the Parliament. Obviously, there is only one reason for this event — the public presentation of the Victory Plan," adviser to the Office of the President Serhii Leshchenko said in a post on Telegram.
In his evening video address to the nation on Monday, Zelensky said he will present the plan, which is thought to include requests for security guarantees from Western allies as well as requests for more war material, to European partners this week.
"This week, we will present to all our partners in Europe our strategy for compelling Russia to bring this war to a just end," Zelensky stated. "Of course, the Victory Plan will be made public. Moreover, along with the initial response we have received from our partners."
Zelensky has already presented the plan to a number of Western leaders, including US President Joe Biden, French President Emmanuel Macron, UK Prime Minister Keir Starmer, and Italian Prime Minister Giorgia Meloni, among others.
Zelensky says he was briefed on 'actual involvement' of North Korea in the war
Ukrainian President Volodymyr Zelensky said on Monday that he has been briefed on the "actual involvement" of North Korea in his country's war with Russia before warning of their presence.
"I held a meeting of the Staff. Several issues. Among the most important was the report of the intelligence services … on the intentions of the Russians for the fall and winter. Everything was quite detailed. The actual involvement of North Korea in the war," Zelensky said in his evening video address to the nation, without elaborating further.
In the address on Sunday, Zelensky said that North Korea had transferred personnel to the Russian armed forces, also without providing details.
South Korea's Defence Minister Kim Yong-hyun told lawmakers last week that North Korea is likely to deploy members of its regular armed forces to Ukraine in support of Russia, South Korea's Yonhap News Agency reported at the time.
Russia has dismissed these claims.
Russia's push to capture Pokrovsk coal mine could wipe out two-thirds of Ukraine's steel production, executives warn
Russia's push to seize Ukraine's largest coking-coal mine threatens to eliminate as much as two-thirds of the country's steel production, steel industry executives have told the economist.
Metinvest CEO Yuriy Ryzhenkov told The Economist that losing the Pokrovsk mine would force Ukraine to import coking-coal, making domestic steel too expensive for some markets and cutting government revenue.
The Pokrovsk mine, which employs 6,000 people, produces coal critical for smelting iron ore, essential for Ukraine’s steel industry. Metinvest, a major mining and metals company, had aimed to produce 5.3 million tonnes of coal from the mine in 2024.
Ukraine’s steel output has already plunged from 21.4 million tonnes in 2021 to 6.2 million tonnes in 2023, following the loss of steel plants in Mariupol. Analysts fear Russia could paralyze the mine’s operations through power disruptions and attacks on transport routes, with the nearby Dobropillya mine potentially next in line.
Ukrmetallurgprom CEO Oleksandr Kalenkov warned that steel production could drop to 2-3 million tonnes in 2024 instead of the projected 7.5 million tonnes, leading to significant economic losses. Steel, a major export before the war, accounted for a third of Ukraine’s exports.
EU, IOM launch €6 million program of skills training, business grants for Ukraine veterans
A €6 million project funded by the European Union aims to offer vocational training, business grants and other types of support to Ukrainian veterans and their families through to February of 2026.
The program will be carried out by the International Organization for Migration (IOM) and Ukraine’s Ministry for Veterans' Affairs, and will cover families in regions including Kyiv, Lviv, Odesa, and Kharkiv, the IOM said in a communique.
The project will provide vocational training for 170 veterans and their families, with up to 50 veteran-run businesses receiving grants and technical support.
In addition, community-based mental health services will be expanded, and local specialists will be trained to ensure ongoing professional support. Civil society organizations will receive assistance, and 20 communities will implement social cohesion initiatives to support veterans' reintegration.
Ukraine's government estimates that veterans and their family members could number between 5 million and 8 million, and a 2023 IOM survey indicates that 15% of veterans had personally experienced or recently witnessed discrimination.
The Conversation: Ukraine faces difficulties on battlefield, diplomatic front after Ramstein meeting delay
Ukraine has been encountering challenges both on the battlefield and the diplomatic front after a summit of the country's main military supporters at the Ramstein Air Base in Germany scheduled for Oct. 12 had been postponed, Professor of International Security at the University of Birmingham Stefan Wolff wrote in an op-ed for The Conversation.
The Ramstein meeting, which was postponed after US President Joe Biden canceled foreign visits to oversee the emergency response to Hurricane Milton, was expected to deliver some big announcements of continuing support for Ukraine, according to Wolff.
The postponement "deprived the Ukrainian president (Volodymyr Zelenskiy) of the chance to pitch his victory plan to his more important allies. So he has been unable to get them to commit to the support that will be necessary to implement it," Wolff wrote.
Although Zelenskiy has managed to secure some support during his recent meetings with some of the Western allies, it is clear these allies are not prepared to decisively increase the aid to Ukraine, Wolff argued.
"The high-level meeting planned for Ramstein would have been the opportunity for the west to change gear decisively. Ukraine can only hope that its postponement, rather than outright cancellation, means its allies may yet step up to the plate," Wolff concluded.
YouTube influencers, Telegram replace traditional media as top news source in Ukraine since invasion, RSF study shows
YouTube and messaging app Telegram have become the main source of news for Ukrainians since the 2022 Russian invasion, as collapsing ad revenues and a severe shortage of labor has decimated traditional media, according to a study by Paris-based NGO Reporters without Borders (RSF).
Ukraine now ranks second in the world in the use of Telegram, only behind Russia, with more than 88,000 active channels and almost 431 million cumulative subscribers, as of August 2024, according to the report. Some 72% of Ukrainians now get news from Telegram, including much of it from anonymous sources.
In terms of news consumption in Ukraine, Telegram still ranks behind influencers and anonymous channels on YouTube, which have attracted almost 15 million followers from Ukraine, as opposed to Telegram's approximately 11 million.
The report attributes the change to multiple factors, including a 65% collapse in ad revenue in the first year of the invasion alone as well as a loss of faith in traditional media, partly spurred by attempts by authorities to use social media, Telegram and other channels of information themselves.
"In the early weeks of the full scale invasion, channels run by national politicians, their surrogates and influencers were often quicker than news media to react to developing events, due to lax editorial standards that resulted in less reliable, easier-topublish content, which was often biased," the report says. "This high content turnover created huge follower growth."
KSE Institute recommends insurance requirement to curb growth of Russia's 'shadow fleet' of oil tankers
In a new 29-page report on Russia's "shadow fleet" of oil tankers, the KSE Institute suggests imposing an insurance requirement to mitigate the environmental risks posed by the often aging and inadequately insured vessels.
These vessels, which carry 70% of Russia's seaborne oil exports, are being used to bypass G7+ oil price caps, allowing Russia to maintain export earnings despite sanctions, according to the institute, affiliated to the Kyiv School of Economics.
The study warns that the tankers, some over 18 years old, carry millions of barrels of oil daily through sensitive maritime areas like the Baltic and Black Seas, heightening the risk of a major spill.
To address this, the report advocates for coastal states to require oil spill insurance documentation for all vessels passing through their waters. This would ensure compliance with international standards set by the International Maritime Organization (IMO) and other global bodies.
The proposal aims to restore leverage over Russian oil sales by pushing more Russian exports back under the price cap, while reducing environmental risks posed by shadow fleet tankers in European waters.
The UNDP Ukraine announced its release of a report, commissioned by the Ukrainian Economy Ministry, that "explores novel financing solutions aimed at advancing Ukraine's national mine action strategy."
BDO Ukraine CEO Vira Savchenko posted about the variety of ways to better enforce sanctions against Russia discussed at the Forunm 2000 Foundation Conference 2024 in Prague, including closing loopholes and "integrating sanctions enforcement into ESG practices."
UkraineInvest, the state investment promotion agency, announced an update to its guidebook on state support for investment projects of €12 million or more, though it didn't say what exactly was updated.
The Embassy of Denmark in Ukraine recapped a visit to Kyiv by a team of experts from the Danish Energy Agency, which included a trip to the Carlsberg Group Ukraine Brewery to witness its "integration of biogas retrieved from their own wastewater plant."
The Aspen Institute Kyiv summarizes its view, explained at the weekend Made in Ukraine conference in Kyiv, that "Ukraine must build an economy prepared for war over time, as the threat may remain for the next 10-20 years."
