World Bank wants to increase donor aid fund for Ukraine to $2 bln
WASHINGTON. April 13 (Interfax) - The World Bank expects to increase the Ukraine Relief, Recovery, Reconstruction and Reform Trust Fund (URTF), through which some donor funding is allocated to Kiev to $2 billion, World Bank Governor David Malpass said.
"We intend to ramp this up to $2 billion and mobilize an additional $1 billion-$2 billion from private partners," he said at a ministerial roundtable in support of Ukraine, which took place as part of the World Bank-IMF spring meeting in Washington.
Malpass said this mechanism was created to mobilize additional support through the World Bank Group's International Finance Corporation, which works with the private sector and has already allocated about $150 million to the private sector in Ukraine with the support of donor partners from Europe.
"We've committed to share risks with IFC," Malpass said.
He said the World Bank Group's Multilateral Investment Guarantee Agency (MIGA) would help with this task and had already provided guarantees of more than $116 million for Ukraine since February 2022.
"It is critical to support the country's long-term growth - through projects and interventions in sectors such as energy, infrastructure, transport, agriculture, and human capital. Our investments will be accompanied by advice on policies and reforms and structuring viable projects, which can mobilize private capital to help Ukraine on its path to a sustainable future," Malpass said.
According to the World Bank, $295 million had been accumulated in the URTF fund by the end of February.
Prime Minister Denys Shmygal said at the round table that the $14 billion needed for Ukraine's rapid recovery this year, confirmed by a World Bank study, must be raised by the middle of this year, while the country's budget has been able to allocate less than half of this amount so far.
He also expressed his gratitude to the United States for the $15.5 billion in donor assistance already provided and the upcoming $7.4 billion by the end of the year.
Earlier this week, the head of the World Bank estimated the financing gap for the rapid recovery of Ukraine in 2023 at $11 billion.
Ukraine's amended 2023 state budget provides for foreign financing to cover the budget deficit in the amount of about $42 billion, or around $3.5 billion a month. Finance Minister Sergei Marchenko said recently that the conclusion of an agreement with the IMF on a four-year Extended Fund Facility (EFF) for $15.6 billion gives reasons to say that the problem of financing the 2023 budget was resolved and priority would now be given to finding funds for recovery.
Out of the $14 billion verified by the World Bank along with the Ukrainian government, the European Commission, and the UN as a sum required for Ukraine's rapid recovery in 2023, the country's state budget provides for about $3.3 billion, while the rest of the funding should be raised with assistance from foreign partners.