The British company Amber Infrastructure and the Ukrainian investment group Dragon Capital have won the open selection to manage the European Reconstruction Fund for Ukraine. This was announced by KfW, the German development bank. The establishment of the fund is supported by the governments of Germany, Italy, Poland, France, as well as their development banks, the European Commission, and the European Investment Bank.
This is reported by Finway
Fund Objectives and Key Investment Areas
The European Reconstruction Fund for Ukraine aims to attract over €1 billion from public development banks and private investors. The funds will be directed towards the development of strategic sectors of Ukraine’s economy, including:
- restoration and modernization of energy infrastructure,
- development of wind and solar energy,
- upgrading industrial enterprises,
- building digital infrastructure, including new data centers.
“The fund is designed to attract over €1 billion from public development banks and private investors and directly invest in private projects in strategic sectors of the Ukrainian economy.”
Financial Structure and Prospects
To reduce risks for private investors, the fund’s structure includes a special tranche for first losses, which will be capitalized by KfW and other public investors. The total amount of this buffer will reach up to €220 million. This will enable the attraction of additional private investments, with a target amount of raised funds set at €800 million by 2026. If the security situation in Ukraine improves, the fund’s volume may increase to over €1 billion in 2027-2028. Upon reaching the target amount, the fund is capable of generating a multiplicative investment effect of €6-7 billion.
The official launch of the European Reconstruction Fund for Ukraine is scheduled for the Ukraine Recovery Conference, which will take place in Poland this summer. Immediately after this, the fund will commence its investment activities.