Written by Sergii Zapototskyi – UVECON, EECFA Ukraine
Ukraine has been defending its independence with weapons in hand for over 1000 days. Through blood and suffering, it has preserved its name on the world map and is gaining more and more respect as a nation of unconquered, proud and free people. And despite the war, life goes on and there is a constant need for reconstruction and restoration.
In September 2024, the Deputy Prime Minister for Reconstruction and the Head of the State Reconstruction Agency were appointed, and in parallel, the government approved the ‘Unified portfolio of public investment projects’ which is a list of large-scale post-war reconstruction projects (750 currently) with an estimated UAH 2.36 trillion. At the same time, total funds of the State Budget of Ukraine for public projects in 2025 is UAH 256.1 billion where UAH 186.9 billion are receipts from international financial organizations and donors (loans, grants, state guarantees).
The priority is to increase the stability and the restoration of the energy grid of Ukraine and UAH 51.3 billion are earmarked for such public projects in 2025. Energy facilities in the portfolio include the construction of the 3rd and 4th units of Khmelnytskyi nuclear power plant on UAH 134 billion to provide an additional 2 GW of energy capacity. (The loss of energy capacity in Ukraine in 2024 alone has been about 9 GW). Another priority is the rehabilitation of hydroelectric power plants on over UAH 15.3 billion and a pilot project for hydrogen energy on UAH 413 million.
Transport projects are estimated at UAH 248 billion and the main ones include the completion of a concrete bypass road around Zhytomyr and the development of border road infrastructure on the Ukrainian-Polish border (Krakovets, Rava-Ruska, Yavoriv in Lviv region). The segment will also see metro development in Kharkiv and Dnipro, the development of seaports in Kherson and Odessa, as well as the restoration of civil aviation in the future like the reconstruction of airports in Boryspil (UAH 32.8 billion), Lviv (UAH 1.2 billion) and Chernivtsi (UAH 1 billion).
Besides these, they plan to build the National War Memorial Cemetery (UAH 7.4 billion), to provide housing for war veterans (almost UAH 20 billion) and for internally displaced persons (UAH 1.7 billion), and to centrally repair war-damaged housing (UAH 35 billion) and Okhmatdyt hospital (UAH 14.8 billion). There are also many renovation projects for schools, gymnasiums, and several projects to build new or renovate prisons and detention centers (e.g. a new pre-trial detention center in Kyiv region on around UAH 1.6 billion and the repair of a camp for prisoners of war in Lviv region on UAH 112 million). UAH 6.7 billion have been allocated for adaptation to climate change as well, and a dozen of waste processing plants will be built across Ukraine on over UAH 124 billion, including water purification systems.
On the one hand, this is post-war reconstruction through repairs and construction that have been postponed for years. On the other, this is a historic chance for the economy to start hundreds of new projects that will create a new quality of life for citizens through new jobs, better wages and social protection, greater accessibility to housing, education, and medical services.
Expenditures from the state budget for priority reconstruction works will be UAH 141.1 billion. Another UAH 115 billion is provided in state guarantees, which will allow borrowing money for construction from foreign partners. First, they plan to use funds under the Ukraine Facility program for EUR 50 billion financed by the EU. Financing is also planned through international financial organizations and foreign governments where the latter take patronage over the revival of Ukrainian regions. Local financing and others (public-private partnerships and various grants) are also included. Large-scale reconstruction could bring big foreign investors to Ukraine, mainly construction companies with their technologies and expertise.
Forecast for the whole construction sector of Ukraine will be available on 16 December in the new EECFA Forecast Report Ukraine that can be purchased on the EECFA website.