European Investment Bank to finance almost €600 million for energy, transport and business resilience
As part of the new €2.3 billion EU funding package announced at the ‘Ukraine Recovery Conference’ yesterday in Rome, the European Investment Bank (EIB) Group will provide almost €600 million in fresh financing for energy systems, transport networks and a range of businesses in the country. The financing takes the form of EIB loans, which are backed by EU guarantees.
The package includes financing for critical infrastructure and other financing to support Ukraine’s recovery and reconstruction.
Improving energy and transport infrastructure
The funding to restore hydropower plants involves a €120 million EIB loan to Ukrhydroenergo, Ukraine’s largest hydropower company. The credit will support the rehabilitation of three strategic hydropower plants – Kaniv, Kremenchuk and Dnipro – and address urgent needs at other sites to help maintain electricity supply amid Russian attacks on Ukraine’s energy system.
The district-heating part of the package includes two EIB loans totalling €100 million. The loans of €50 million each are to Ukrainian banks Ukrgasbank and Oschadbank, which will direct the funding to municipalities. Local authorities will be able to invest in decentralised heat generation, renewable energy and energy efficiency in public buildings.
The ground-transport component takes the form of a €134 million EIB loan to Ukraine’s national Agency for Restoration. Repairs will be done to bridges and roads including the M06 highway connecting Kyiv to the Hungarian border, while the border-infrastructure improvements will bolster EU–Ukraine Solidarity Lanes.
Supporting Ukraine’s SMEs and private-sector recovery
The SME component of the package includes three new EIB loans: €100 million to Ukreximbank, €70 million to Ukrgasbank and €60 million to Bank Lviv. These three Ukrainian banks will direct the financing to SMEs, with a particular emphasis on green investments.
In addition, the EIB is extending EU-backed guarantees to four Ukrainian lenders: Ukrgasbank, Bank Lviv, Kredobank – a subsidiary of Poland-based PKO Polski Bank – and the Ukrainian unit of Piraeus Bank. This step will unlock yet more financing for small Ukrainian businesses.
Backing EU exports to Ukraine
Ten Member States – Denmark, Finland, France, Germany, Italy, Latvia, Romania, Slovakia, Slovenia and Spain – have joined InvestEU’s €300 million Ukraine Export Credit Pilot, a pioneering initiative to support trade with Ukraine. Three more EU countries are expected to join the facility soon.
This guarantee facility, supported by the European Commission flagship programme InvestEU, is managed by the European Investment Fund (EIF), which is part of the EIB Group. Each country’s export credit agency is receiving an EIF-backed guarantee to support national exporters of goods and services to Ukraine. InvestEU Advisory will also contribute to the success of the pilot.
The guarantees help reduce financial risks and keep exports flowing – from machinery and building materials to critical technologies – while supporting Ukraine’s deeper integration into the European single market and the country’s longer-term path towards EU membership.
Driving recovery through project preparation
To help the Ukrainian government turn its recovery priorities into real investment, the EIB has launched Ukraine FIRST – short for Ukraine Facility for Infrastructure Reconstruction – a new project preparation programme developed together with the EBRD and the European Commission. Backed by €20 million from the EU’s Ukraine Facility, with a further €5 million each from the EIB and EBRD, the €30 million initiative will support feasibility studies, technical assessments and procurement planning – enabling faster, better-prepared infrastructure projects. Further donor contributions are also expected.
Strengthening Ukraine’s energy resilience
On the basis of a German government International Climate Initiative (IKI Fund) grant of €20 million, the EIB is teaming up with GIZ and the UNDP to help integrate under the IKI Fund’s Renewable Energy Solutions (RES) Programme green energy into projects that Ukrainian municipalities have implemented with EIB support. The RES Programme will enable selected Ukrainian cities that have boosted energy efficiency in their public buildings to obtain additional grants to install equipment such as solar panels, batteries and heat pumps. The GIZ and UNDP will assist local authorities with implementation, making it easier and faster to deliver these improvements, especially in smaller cities and communities with limited capacity.
Furthermore, through an additional contribution of €19.6 million by the German government to the IKI Fund, the EIB and Germany agreed to support Ukrainian coal-dependent regions through the IKI Fund’s Just Transition and Just Resilience for Ukraine (JTR-U) Programme. The JTR-U Programme aims to facilitate investment projects addressing the socio-economic impacts of the gradual phasing-out of coal mining and creating economic opportunities in Ukrainian coal communities, contributing to Ukraine’s broader recovery and reconstruction.
Strengthening safeguards to protect recovery funds
The EIB and the State Audit Service of Ukraine have signed a new agreement to boost efforts against fraud and corruption in EU-financed projects. The partnership will enhance coordination on prevention, detection and early-risk identification, helping ensure recovery funds are properly used through stronger oversight.
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