The European Union's lending arm, the European Investment Bank (EIB), has signed agreements to mobilize close to 1 billion euros ($1.03 billion) in investments into Ukraine’s public and private sectors as the U.S. moves to cut funding to development projects in the country.
U.S. President Donald Trump’s decision to freeze all foreign assistance has cast uncertainty on the future of projects in Ukraine in nearly every sector, from critical infrastructure to civil society development.
Nadia Calvino, the EIB's president, said at a press briefing on Feb. 10 that she had discussed Ukraine’s urgent funding needs with Prime Minister Denys Shmyhal to see where the bank could fill the gaps if international partners withdraw their support.
"We discussed the priority areas where the EIB could step up its support — for example, in the areas of border management, transport, energy, and municipalities," Calvino said in Kyiv during her first visit to the country since taking up office as head of the EIB a year ago.
"We’re working very closely with the government to finance the necessary investments to rebuild, repair, and make national infrastructure more resilient," she said.
The investment announced on Feb. 10 includes 420 million euros ($433 million) in Ukraine’s public sector to help restore critical infrastructure such as energy, heating, water supply, hospitals, schools, and social housing.
On the private sector side, the bank has signed an agreement to mobilize close to 500 million euros ($515 million) in financing for small and medium-sized businesses throughout the whole country, including in front-line regions, Calvino said.
The bank also announced the German Economy Ministry is providing a 16.5-million-euro ($17 million) loan through the EIB’s climate initiative fund to finance renewable energy projects in Ukraine. The EIB is a key lender in funding Europe’s green transition.
Calvino said the EIB has been working with the Ukrainian government to speed up the implementation of projects on the ground over the last year. The bank signed a pledge with Ukraine's government last year to accelerate the deployment of 560 million euros ($596 million) it had ready to help rebuild Ukraine in 2024.
"Municipalities and small and medium-sized businesses can start already approaching their banks to see about this financing and we hope that it will be mobilized as soon as possible," she said at the press briefing.
Since the start of Russia’s full-scale invasion, the EIB has delivered over 2.2 billion euros ($2.26 billion) in financing mainly dedicated to repairing and modernizing Ukraine’s municipal infrastructure.
This latest round of investment announcements are part of the bank’s 2-billion-euro ($2.06 billion) contribution to the EU’s 50-billion-euro ($51 billion) Ukraine Facility loan and grant program.
As Trump’s team looks to negotiate an end to Russia’s nearly-three year full-scale invasion of Ukraine, talks of reconstruction in Ukraine have returned to front and center.
Russia’s constant missile and drone attacks since 2022 have seriously damaged Ukraine’s housing, water and energy systems. Costs to rebuild are approaching the $500 billion mark.
Calvino said she is sure the EIB will play an important role in supporting the reconstruction of the country "not only because of our direct investment but because of our ability to mobilize public and private investment to support the public and private sector in Ukraine, and beyond."
Meanwhile, European member states recently called on the EIB to increase its lending to the bloc’s defense industry and beef up its defenses against any possible Russian attack in the future.
The president said she welcomes the support the bank has received from European membes states on stepping up the EIB’s role in supporting Europe’s defense and security sectors "while safeguarding our financing capacity and AAA rating."
The bank already invested 1 billion euros ($1.03 billion) into the sector last year and plans to double it to 2 billion euros ($2.06 billion) in 2025, she added.
Yana Prots
