The Norwegian government has given the green light to Norfund, the state development finance institution (DFI), to invest in Ukraine, with an eye to boosting the reconstruction of the country.
The government has proposed that NOK 250 million ($23.8 million) be set aside in 2024 for Norfund, which focuses mainly on equity investments, to invest in Ukraine, according to a press release.
"Capital provided by Norfund reduces the risks for companies investing in Ukraine, including Norwegian companies," said Prime Minister Jonas Gahr Støre. "This will be essential in advancing Ukraine’s reconstruction and recovery efforts after the war has ended."
Norfund, which has invested most heavily in Africa and Southeast Asia, says it had a total committed portfolio of about $3.4 billion as of the end of 2023, including direct investments in 230 entities and more than 1,000 indirect investees.
"Norfund largely provides equity investments, which entails higher risk than the loans and guarantees offered by other development finance institutions and the multilateral banks," the government said in the press release. "This type of capital is crucial to develop vital, sustainable projects."
The DFI will receive its funding for Ukrainian investment via Norway's Nansen Support Programme for Ukraine, a channel for all Norwegian military and humanitarian aid to the country.
