By Ukraine Rebuild News Staff
A reconstruction fund created by major international firms for the government of Ukraine aims to raise $10 billion from governments, multinational organizations and other large donors, then use it to generate at least $50 billion in investments in the country, Ukrainian Deputy Economy Minister Oleksandr Hryban said in an interview with national news agency Ukrinform.
The Ukraine Development Fund, to be formed with pro-bono collaboration from BlackRock, JPMorgan, McKinsey and leading global law firm Freshfields, will take minority stakes in various investment projects in Ukraine using low-cost funding from major donors, Hryban said.
“The fund, by selecting certain projects, will demonstrate that it is entering into this investment, which means that this project is worthy of attention, meets all the criteria and requirements,” he said. “In this way, the fund will mobilize additional sources of capital and, for example, even by entering a certain project as a minority shareholder of 10-20%, it will attract additional private investment funds, sovereign wealth funds, international financial organizations, expert credit agencies, and international commercial banks.”
“All this will allow multiplying the funds of partner countries and those philanthropists who will entrust money to the foundation itself, and turning every dollar received into $5 of mobilization of the entire ecosystem,” he said.
Hryban didn’t say when he expects the fund to start investing, but the fund likely won’t start until the fighting in Ukraine ends.
BlackRock has committed its Financial Market Advisory team to helping create the Ukraine Development Fund while JPMorgan said it is offering the Ukrainian government “its expertise in restructuring strategies, sovereign credit ratings, asset management of government liquidity and digitization of the economy.”
Freshfields, meanwhile, said corporate partner Seb Lawson, who has been seconded to an NGO in Ukraine for two years, will lead the firm’s “multi-practice team” helping the Ukraine Development Fund.
