Supporting
Ukraine:A Study on
Potential
RecoveryStrategies
for Ukraine
January 2023

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Contents
04

Ukrainian context

04• Background to the Ukrainian conflict04• Initial international response05• Lugano conference24

Suggested principles
to help Ukraine

26

Coordination on Ukrainianreconstruction

How the war affected Ukraine –26• Prioritization of efforts in Ukraine

our diagnosis of the situation

27• Added initiatives

07• War damages

28• Needs assessment

08• Economic and social diagnosis

30• Study on prioritization of support

11• Sectorial and topic diagnosis

30• Prioritized initiatives

33• Enablers

33• Capacity to absorb funding

34

Recommendations

07

20	Why the recovery
in Ukraine needs immediate
and bold support

The findings, interpretations and conclusions are those of the authors and do not necessarily reflect the views of the European Investment Bank.

cUkrainian context
Background to the Ukrainian conflict
On 24 February 2022, Russian military forces enteredUkrainian territory, violating Ukraine’s national sovereignty
and international agreements including the 1994 Budapest
Memorandum, and the Charter for European Security,
ratified in 1999’s Istanbul Document. This would represent
the start of a full-scale invasion into Ukraine, and the
beginning of the largest war in Europe since the Balkan
conflicts of the 1990s.
Russia’s large-scale attack was preceded by months oftroop buildup at the border under the false pretense ofa military exercise. Political justification propaganda for theattack was produced by the Russians on 21 February, byrecognizing the independence of the Luhansk and Donetsk
People’s Republics, and falsely claiming they must protect
the Russian-speaking minority in eastern Ukraine. These
two breakaway provinces are themselves a result ofa protracted eight-year conflict orchestrated by Russia,
which crippled Ukraine’s economy, as industrial areas, richin natural resources, were lost. Furthermore, illegal
referendums were organized by Russia in four Ukrainian
regions (Donetsk, Luhansk, Zaporizhzhia, and Kherson) in
an attempt to falsely legitimize its military occupation andannex the territories. However, the devastating impact of
the current large-scale war stretches far beyond the4bordering provinces, with Russia opening a front morethan 1,200km wide and reaching as deep into Ukraine’s
territory as the outskirts of Kyiv. As a result of overall
hostilities, after the first nine months of fighting, it wasestimated there were over 8 million refugees abroad plus
an additional 5.9 million internally displaced people.
Further examples of devastation include: more than
150,000 homes destroyed; 27% of the railway network
disrupted; the entire oil refining capacity destroyed, with oil
supply 30% down; and energy production capacity reduced
by at least 40%. Thus, the Ukrainian economy, strangled by
the war, is expected to shrink by nearly 30% in 2022 andhas become reliant on foreign aid.

Initial international response
The outbreak of the war was the catalyst that triggeredwide-scale support for Ukraine and its people. The Westerninternational community quickly mobilized aid to Ukraine
politically, financially, and militarily, aware of the scale ofhumanitarian needs and of the strategic significance of an
independent Ukraine. Russia was isolated politically andhit with economic and financial sanctions in a coordinatedapproach. Military powers, including the USA and the UK,
donated significant military help to contain and repel theinvasion. EU countries neighboring Ukraine gathered
support, donations and committed further resources,

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

while at the same time welcoming Ukrainian refugees andestablishing new trade channels. Major international
powers, including the EU, are channeling macro-financial
aid for Ukraine to help the government cover the vast
budget gap that emerged, and provide for the Ukrainian
people. These donations are channeled either directly or
via the IMF and the World Bank, whose primary focus is
now macro-financial aid for the Ukrainian budget. Other
IFIs including the EIB, the EBRD, and several smaller
institutions continue working, or consider entering Ukraine
to provide further budgetary support or targeted
emergency economic and social investments. Yet themagnitude of the current help is sufficient only for survival,
and further assistance is needed for Ukraine to startregaining its self-sufficiency. Hence the focus must start toshift away from just immediate help and move toward
planning comprehensive recovery efforts.

Ukraine EU candidate status
Upon the Russian invasion, on 28 February 2022, Ukraine
applied for EU membership. On 17 June 2022, theEuropean Commission recommended to Council
confirming Ukraine’s perspective to become member ofthe EU and provided its opinion on granting it candidate
status​. The European Council subsequently acknowledged
the considerable effort that Ukraine has made to become
closer to the EU under very difficult circumstances and thecandidate status was formally granted on 23 June 2022.
The EU accession process remains based on establishedcriteria and conditions, however granting Ukraine swift
future EU membership perspective signals long-term
support for Ukraine development.

Lugano conference
On 4 July, delegations from Ukraine, countries allied to
Ukraine, international institutions, and multiple additional
partners met in Lugano at the Ukrainian Recovery
Conference. The event was attended by multiple heads ofstate—including the Ukrainian Prime Minister, Denys
Shmyhal, and the president of the EU Commission, Ursula
von der Leyen—as well as representations of majorinternational institutions, including EIB, EBRD, IMF, World
Bank, and the OECD.
The conference represented a kick-off for international
efforts to reconstruct Ukraine, affirming the long-term
commitment toward Ukraine, and roadmapping therecovery plan. It gave an opportunity to share a vision of
future cooperation and form partnerships between the key
attending parties. It also brought focus to the vast
investment needs for the recovery and long-term
modernization of the Ukrainian economy. Countries alliedwith Ukraine volunteered to take a patronage over recovery
efforts in chosen regions of Ukraine disrupted by the war.
As a result of the conference, seven key principles forinternational aid of Ukrainian recovery were established.

Figure 1: Principles of Ukraine’s recovery process
Partnership
The recovery process led by Ukraine, withinternational partners. Based on assessment
process, aligned priorities, joint planning forresults, accountability, and monitoring.

Multi-stakeholder engagement
The recovery process has to facilitate
collaboration between all actors, including
the private sector, civil society, academia, andlocal government.

Reform focus
Achieving Ukraine’s reform efforts andresilience in line with Ukraine’s European
path.

Gender equality and inclusion
The recovery process has to be inclusive andensure gender equality and respect forhuman rights.

Transparency, accountability,
and rule of law
All funding for recovery needs to be fair,accountable, and transparent.

Sustainability
The recovery process has to rebuild Ukraine
in a sustainable manner aligned with the2030 Agenda for Sustainable Development
and the Paris Agreement.

Democratic participation
The recovery process has to be a whole-ofsociety effort, rooted in democratic
participation by the population.

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5

National Council for the Recovery of Ukraine
During the Lugano conference, the National Council for the
Recovery of Ukraine from the War (NRC), a special
advisory body under the president of Ukraine, presented
Ukraine’s National Recovery Plan (NRP). The plan is themain framework document that roadmaps the recovery
process. The NRP comprehensively outlines investment
needs in the years to come, elaborating on how to build up
the needed resilience to win the war, guiding
reconstruction efforts and facilitating the long-term
modernization and growth of the economy.
The presented programs focus on strategic objectives,
enablers, and transformation engines to achieve the set
targets. The NRC estimates that implementation of the
programs will amount to around $750 billion spread overthree times horizons:6• Urgent resilience (2022) - Addressing severe needs
that have appeared due to the military situation andresulting destruction of infrastructure - $60 billion–$65
billion• Recovery (2023–2025) - Enabling Ukrainian economy toreturn to full capacity - $250 billion–$300 billion• Modernization (2026–2030) - Facilitating long-termtransition into a modern and sustainable economy $400 billion–$450 billion
Various organizations contributed to, assessed, and areworking on addressing the National Recovery Plan. The
European Investment Bank and Boston Consulting Group
were both heavily engaged in supporting Ukraine during
the Lugano recovery conference and jointly partnered tocontinue working toward a free and modern Ukraine.

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEHow the war affected Ukraine—
our diagnosis of the situationW

hen setting out to diagnose the fluid and complex
situation in Ukraine, it is important to consider
that simply analyzing war damages and resulting
needs would only offer a narrow view of the status quo.
Thus, the optimal diagnosis approach consists of firstdrawing out war scenarios, stress-testing them with topic
experts, and judging their likeliness of realization. This
allows for a holistic approach while having in mind thepotential outcomes over a 10-year horizon.

particularly in the east and south, where the war has been
raging most intensely. The Kyiv School of Economics (KSE)assessment as of November brings the damage
estimations to a total of $135.9 billion, with housing ($52.5
billion) and transportation infrastructure ($35.6 billion)
accounting for a combined 65% of total damages.
Furthermore, damages to the industry and businesssectors amount to an estimated $13 billion, as 4121
industrial enterprises are reported to have been damaged
or destroyed. The World Bank’s estimated damage as of
1 June amounts to $97 billion, similar to KSE’s assessment
at the time, thus confirming the vast extent to which
Ukrainian infrastructure has suffered since the onset of theinvasion. The majority of damages remain nevertheless ininaccessible areas (somewhere around 75% of the total), as
only the north and northeastern regions (Chernihiv, Kyiv,
Sumy and Kharkiv) have since been secured and are notcurrently part of the frontline, while fighting is still ongoingin the eastern and southeastern parts of Ukraine (Donetsk,
Luhansk, Zaporizhia, Kherson, Mykolaiv). The proximity of
the frontline makes rebuilding initiatives potentiallyredundant until a certain degree of security can beensured, as civilian infrastructure has been targeted timeand again since the beginning of the conflict.

The economic situation was analyzed at a macro level,
followed by deep dives into several key areas, which allows
for the understanding of the cause-effect relationships andthe identification of interdependencies within the
Ukrainian ecosystem. This two-pronged approach provides
a bird’s-eye view of the situation while also benefiting fromthe granularity needed to pinpoint the most impactful
initiatives that can strengthen Ukraine in the existing andfuture contexts.

War damages
Eight months into the invasion, the ongoing fighting has
already left a deep scar on Ukraine’s infrastructure,

Figure 2: Kyiv School of Economics damage estimates as of November (B$)
Residential buildings

53

Logistics

36

Industry

13

Agriculture

7

Vehicles3

Education
Commerce

8
2

Energy7

Healthcare

2

Culture & Religion

2

Digital infr., Utilities & Adm.
Environment

414Source: Kyiv School of Economics
1. As of 5th September

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7

Economic and social diagnosis
The war had widespread effects on the Ukrainian economy,
with the National Bank of Ukraine projecting a 30% drop in
GDP for 2022, while inflation was already at 24.4% in
September and is tipped to reach 30% by the end of theyear.

Under war conditions, the initial forecast for the monthly
state budget deficit was estimated at around $5 billion, andthe total 2022 deficit was expected to be in the range of
30% of GDP. Five months after the start of the war, budget
revenues without external financing would cover only 40%of the expenses, yet the deficit was narrower than expected
as of September, at about $13.5 billion, thanks to increases
in grants received from abroad, which are classified asstate budget revenue.

Figure 3: Distribution of GDP by sector, 2021 data and 2022 estimate
GDP by sector and expected decrease ($B)
-30%
200
Agriculture

25 (12%)

Industry (incl. Metallurgy, Manufacturing,
Construction, Energy)

55 (27%)~125–155
15–20 (~13%)
20–25 (~17%)

Retail and Services (incl. Logistics)

88 (44%)

Public, Defense, Education, and Health32 (16%)45–55 (~35%)

45–55 (~35%)

2021

2022e

Source: State Statistics Service of Ukraine

The pre-war share of exports in Ukraine’s GDP was ofaround 35%, and the Ministry of Economy’s goal is tosteadily increase it to 50% as the transport bottlenecks will
gradually fade out. Compared to neighboring Poland, the8

Ukrainian economy has a strong agrarian base and is lesstrade-focused, while a gap can be noticed in employee
productivity statistics, as outlined in the graphic below.

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Figure 4: GDP and employment distribution by sector for Ukraine
and neighboring Poland% of GDP, Employment, and Enterprises by sector, 2021
UkrainePoland
100%

100%

100%

17%

7%
12%

12%
28%

19%

16%

23%

3%

100%

100%

8%
34%

14%

100%

16%
30%

25%

23%

24%

17%

51%

19%

51%

28%

21%

16%

19%

17%

GDP

Employment

Enterprises

GDP

Employment

Enterprises

$200B

15.6M

700K

$674B

16.6M

2.1M

Agriculture
Relies more on agriculture than
Poland and other European
countries in generalIndustry

Trade

15%

Services

5%

21%

9%

Public, defense, education, and health~3 times lower employee
productivity (GDP/employee)

3 times fewer enterprises than
Poland, correlated withdifference in GDP

Source: State Statistics Service of Ukraine; Financing SMEs and Entrepreneurs 2020: An OECD Scoreboard

Around 61% of the country’s population is estimated tohave been directly affected by the conflict, with around
13 million stranded in affected areas, 5.9 million internallydisplaced, and 8 million having fled abroad, both
permanently and temporarily, as of the end of September,according to UN data. The flows of internal refugees
fomented instability in several central and western regions,as local infrastructure capacity could not cope with theneeds of the increasing population flows. This resulted inlarge imbalances in terms of rent prices, which increased
up to threefold in certain areas where demand was toohigh and citizens were having to shelter in public schools
or gyms while severely decreasing in other cities that wereexperiencing negative net population flows. The fear anduncertainty stemming from the war has been exertinga heavy toll on Ukrainian citizens, with 59% of adults aged
18–60 reporting they have been experiencing physicalhealth issues, while 61% reported to have been
experiencing mental health issues.
The effects of internal displacement have sent ripples
throughout the whole country, with severe consequenceson businesses. As people began fleeing the war zones andadjacent areas, orders stopped coming in and businessactivity in the affected regions almost grinded to a halt.
The SME sector, providing about 60% of employment and
20% of pre-war GDP, was severely hit, as only 13% of SMEs

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were still working in full during March, and 42% were notworking at all according to a survey conducted by theEuropean Business Association. Results improved in July,as 28% of enterprises reported to be working in full, while
only 16% affirmed they were not working at that time. The
National Bank of Ukraine estimated unemployment
reached 35% at end of July, while one in five Ukrainians
reported having a job but receiving only partial wages.
Trade was subsequently hampered as the invasion
progressed in the east and south of Ukraine, yet thebiggest blow was dealt by the blockade of seaports.
Accounting for about 70% of the total export volume,
seaports were crucial for the outgoing flows of grain and
raw materials, which represented the bulk of Ukrainian
exports. Logistical bottlenecks stemming from the limited
transport capacity of land routes caused exports toplummet after the start of the war. The 37% growth inexport value during the first two months of the year could
not compensate for the 48% reduction between March andJune, according to data provided through the State
Statistics Service of Ukraine. During the first half of 2022,
total export value decreased by 24%, while total volume
was down by 30%. Chemical industry products (-68%),
metals (-57%), and minerals (-30%) were among the mostaffected categories in terms of volume, as industrial
activity decreased and the remaining available transport9

routes could not compensate for the lost capacity ofmaritime shipping.

$0.3 billion for September, and around $5.5 billion for the
first nine months of the year.

Additionally, as the rate of decrease in import value waslower than in export (18% versus 24%), the negative tradebalance has more than doubled (from $1.2 billion to $2.6
billion) during the first half of the year.

Given that most eastern enterprises lowered or stopped
production, the central and western regions began playing
a more important role in Ukraine’s economy. The flow ofexports has gradually shifted, and most of the central andwestern oblasts either grew or moderately decreased
during the first seven months of the year, albeit at a slower
pace than the country average, while in the eastern half of
Ukraine exports decreased by almost half in most oblasts,
as seen in the graphic below. Revitalizing the economy andde-bottlenecking transport flows in key areas is now ofutmost importance for bolstering Ukrainian resilience andenabling a self-sustaining economy.

Recently, more optimistic signs started to emerge with thepartial unblocking of the Odesa port, as total export
tonnage increased from 5.8 million tonnes in July to 9.7
million tonnes in September, while total turnover for
September exports was of $4.1 billion, compared to the$2.9 billion registered in July. This allowed for a monthly
decrease in the balance of trade in goods, which was only

Figure 5: Distribution of exports per oblast
Y-o-y change in export flows by oblast of production for period of January – July(and % of 2021 total)

13
8

7

10

19

12
11

4
2
1

14

6

5

23

18

9

17

24

21
22

16

3
15

15

25

20

26

1. Zakarpattia +19.4% (2.5%)
2. Ivano-Frankivsk -36.9% (1.7%)
3. Chernivtsi +29.3% (0.3%)
4. Lviv +4.8% (4.3%)
5. Ternopil +18.9% (1.0%)
6. Khmelnytskyi -15% (1.3%)
7. Volyn +25.2% (1.2%)
8. Rivne +13.7% (1.0%)
9. Vinnytsia +24.2% (1.9%)
10. Zhytomyr -10.0% (1.1%)
11. Kyiv -6.5% (3.8%)
12. Kyiv City -25.8% (22.5%)
13. Chernihiv -44.4% (1.8%)
14. Cherkasy +45.3% (1.3%)
15. Odesa +59.3% (2.5%)
16. Mykolaiv -13.6% (5.1%)
17. Kirovohrad -18.2% (1.5%)
18. Poltava -39.8% (4.7%)
19. Sumy -38.1% (1.6%)
20. Kherson -61.5% (0.6%)
21. Dnipropetrovsk -38.9% (18.0%)
22. Zaporizhzhia -12.7% (7.0%)
23. Kharkiv -46.4% (2.7%)
24. Donetsk -93.7% (10.3%)
25. Luhansk -90% (0.2%)
26. Crimea

Note that -28% decrease in y-o-y export flows is the average for the country
Source: Ukrainian National Service of Statistics, National Institute of Strategic Studies of Ukraine

10

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Sectorial and topic diagnosis
The resulting picture is granular and intricate, going far
beyond the visible infrastructural damage and military

obstruction to economic activities. Key needs per sector
have been identified as shown here.

Figure 6: Key problems and needs identified per sector in Ukraine
EconomyInfrastructure & Energy
Agriculture

Logistics

Invest to store current harvest and process
yieldsSecure export capacity to Constanta port andEU borders

Need financing for next year’s harvest(fertilizer, seeds, stock)

Integrate with EU rail and road

Grain exports decreased up to 90% during2022 H1

Deep-sea shipping irreplaceable for bulk
transport (e.g., grain)

Repair key damaged roads, rails, and airports

Industry

Metallurgy and mining production down
~65%

Municipal

Improve residential energy efficiency
Modernize water and district heating facilities

Re-locate (where possible) and re-focus
logistics (e.g., to EU)

Provide risk guarantees for mortgages

Working capital needed

Construction

Fuel

Survive and reorient business toward
reconstruction efforts

Increase transport capacity for refined fuels

Construction sector frozen—limited demand

Oil supply ~30% down

Enable fuel trade routes through the Danube
Finalize advanced projects
Develop domestic biofuels production

Retail and services

Electricity

Relocate to safer areas

Fill the gaps in fuel demand with power whereapplicable~50% of businesses stopped, but 40% arehiring new staff

Working capital to relocate, restart, survive
until fully sustainable

Functioning operation

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Moderate disruption, limited operation

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Strengthen grid due to new distribution &transport needs (e.g., production for export)

Assistance to provide assess to electricity
given 50% of energy infrastructure destroyed

Severe disruptions, operations crippled

11

Agriculture

temporary agreement to allow grain shipments departfrom Ukrainian seaports have fostered a gradual recoveryof agricultural exports, which were down an estimated 25%
y-o-y as of September.

Agricultural production has been continuing, albeit ata lower level, despite the challenges posed by the war.
Output has fallen as vast areas have been occupied ormined, and an acute need for storage and transport
capabilities became increasingly evident once the 2022
harvest began to be collected. Investments are now
needed to address these bottlenecks, while ramping up
processing and moving the goods higher on the value
chain would provide another solution to cope with thelower export capacity and increase production value.
One of the key sectors of the Ukrainian economy,
agriculture was responsible for about 12% of GDP and 17%of employment before the war. Given that around 90% of
grain was shipped through the Black Sea ports before thewar, exports for April were down to only 20% compared to
December 2021, but were approaching pre-war levels in
September.
Increasing transport capacity via rail, rerouting shipments
via the Danube toward the port of Constanta, and the

The lack of export capacity generated issues in grain
storage, and a shortage of around 25% of this year’s crop is
estimated, as last year’s harvest is yet to be fully sold. The
shortage in storing capacity could have been even larger if
not for the decrease in this year’s production volumes.
With around 30% of agricultural land affected by war, grain
and oil production volumes are estimated to fall during2022 by around 30%–40% according to Ukrainian forecasts,
while the crisis is further exacerbated by rising prices andshortages in fuel, seeds, and fertilizers.
Ensuring there is enough storage space and transportcapacity to unlock exports is now key for agriculturalcompanies, while the smaller players would also need to
be provided with working capital support for procuringseeds and fertilizers for 2023’s harvest.

Figure 7: Grain and oil production, 2021 data and 2022 estimate(M tonnes)
-37%
102
65

2022e

2021
Source: BCG study

Industry
The Ukrainian industry has been heavily affected by thewar, not only by direct damages to its factories, but also by
rising prices and bottlenecks in transportation. The
industrial companies’ ability to maintain their businesses
profitable has thus been severely limited, forcing them toreduce production and release employees. Investments are
now needed to bring down logistics costs, while industrial
producers need working capital support to restart theiractivity.

12

Increased input prices (energy, logistics, imports), staff
shortages, and war destruction (around 412 industrial
enterprises estimated to have been lost during the war by
beginning of September) had overwhelming effects on themetallurgy and mining sectors, with iron ore exports
between January 2022 and August 2022 decreasing by 78%
on a monetary basis, while national steel production was
down 64% y-o-y between January and August, as the
Mariupol factories accounted alone for 40% of yearly steel
production.

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEAs most of the goods were shipped by sea, existingbottlenecks in land transport and rising tariffs imposed by
the Ukrainian railway company drastically decreased
profitability for domestic exporters. Additionally, falling
prices for metals and raw materials on the global markets(as of July, average industry prices decreased below pre-war
levels) forced enterprises to reduce production as they
could no longer afford paying all their employees in full.
The transport bottleneck was further aggravated with thetemporary ban concerning exports of iron and manganeseore, as the government decided to prioritize grain exports
while the sea routes were still closed.
As a result, the volume of exported metals decreased 58%
during the first eight months of 2022 and is not expected
to rebound as long as the cost management issues persist.
Enterprises in the industry sector are in need of working
capital to keep their businesses running, but above all, thede-bottlenecking of logistics which would bring downtransport costs is paramount for their revival.

Figure 8: Steel production y-o-y variation(M tonnes)
-64%
14.4

5.2

Jan 2021–Aug 2021

Jan 2022–Aug 2022

Source: BCG study

Construction
The construction sector grinded to a halt after the onset ofthe conflict and mainly began resuming activities in June.
The public sector undertook only limited reconstruction
initiatives, while private sector initiatives were facing low
demand due to the heightened risk stemming from thewar.
The sector is now characterized by limited demand, staff
shortages, and high prices combined with limited
availability of materials due to supply chain disruptions.

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Among all companies surveyed through the Monthly
Business Outlook Survey conducted by the National Bankof Ukraine, the construction sector had the mostpessimistic outlook, with an index of 41 (versus the
46 average). The forecast therefore remains grim, with
2022 construction output estimated to fall by around 69%
compared to 2021.
Construction companies can be kept afloat by revitalizing
demand from both the private and public sectors and byproviding enterprises with the necessary financing forequipment and working capital to resume activity.

13

Figure 9: Construction output, 2021 data and 2022 estimate(B UAH)
-69%
254

79

by 2022e

2021
Source: BCG study

Retail and services

still in demand and economic activity has not been
severely affected.

Dampened economic perspectives have severely affectedmarket confidence, as the downward slopes of income,demand, and revenues created a vicious circle that
resulted in around half of Ukrainian businesses either
stopping activities completely or barely functioning in themonths succeeding the invasion. Shortages of staff andstorage space, corroborated with higher prices of certain
supplies and broken supply chains, have dealt further
blows to Ukrainian small businesses.
Quicker to react than the larger industrial enterprises,
700 small businesses already relocated to the western andcentral regions of Ukraine by mid-summer, where labor is

The number of open retail outlets was nevertheless 18%
lower y-o-y as of May 2022 but subsequently grew by 9% asof August, as more optimistic signs have started to emerge.
While in May, 19% of the companies reported to theEuropean Business Association that their financial reserves
will be enough to cover a period of one year, thepercentage grew until 30% as of August. Nevertheless, themajority of companies still require support for working
capital, storage space, employee re-skilling and statesponsored re-location at a larger scale.

Figure 10: Number of open retail outlets, data as of May 2021, May 2022
and August 2022-18%

May 2021+9%

May 2022

Aug 2022

Source: BCG study

14

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Transport
Ukraine’s transport network suffered extensive damage in
the northern and eastern parts connecting to Russia andBelarus, but remains mostly operational in the rest of thecountry. Nevertheless, chronic infrastructural issues owing
to lack of investments and maintenance are at the origin
of existing bottlenecks in the Ukrainian logistics sector.
Outdated rolling stock, low quality of roads and railways,
and lack of transshipment and border processing capacity
are severely hindering the Ukrainian economy, which is nolonger able to deliver its products on the international
markets following the blockade of its seaports. Quickenablers such as overhauling existing facilities andinfrastructure on key routes can provide short-term wins
for the Ukrainian economy, and enable it to reach its
overarching goals: long-term prosperity and integration into
the European network.

Heavy infrastructural damage resulted in about 27% of therail network and 14% of the road network being affected,
as per Ukrainian estimations. The vast majority of damage,
however, occurred in the war zones or adjacent areas, andare not of critical importance for Ukraine’s present andnear-term future.
The major bottleneck stems from the impossibility ofresuming maritime shipping, which was responsible foraround 70% of pre-war Ukrainian exports. Currently
available alternative routes (the Danube and rail and roads
toward the EU borders) are overwhelmed, with queues
running for several days for both trucks and freight trains
stuck at border checkpoints or logistic hubs. The Ukrainiantransport crisis is echoing far beyond its borders, withshortages of food, fertilizers, and raw materials being felt
all over the world.

Figure 11: Key developments in Ukrainian transport infrastructure
Logarithmic scale of costs per each transport mode; volume of exported goods pertransport mode in Ukraine, 2021 data
Consequences of the conflict
Water

Rail

Cost per tonne -1K miles
by Mode ($)• Seaport blockade (~70% of 2021 exports)
causing bottlenecks in Ukrainian tradeinfrastructure, unable to handle current volumes

Ship

5

• Increase in shipping costs toward Constanta(RO) port from $20-40 per tonne pre-war, to$150-190 in July due to detour via Danube

Barge

10

Volume of 2021
exports by mode
(M tonnes)
153 (70%)

11 (5%)• 70% increase in rail cargo tariffs as of 1 Julyexerting additional pressure on industries• Only 5 of 13 railway crossings capable ofreloading wagons between different rail gauges

Rail

40

46 (21%)• Decrease of 48% in tonnage volume of
freight transported via rail during first 9 monthsof 2022Road• Thousands of trucks leaving and entering
Ukraine on a daily basis, with queues runningfor several km on both sides of the border

Truck• Transit time for Polish road border of up to
4 days compared to ~4 hours before the war

120

9 (4%)

Source: Ukrainian railways agency, National Institute of Strategic Studies of Ukraine

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

15

Exports have thus plummeted and were down by almost
50% y-o-y for the month of July 2022, while transport costs
drastically increased (70% surge in rail cargo tariffs as of
1 July, shipping costs to Constanta port increased on
average by 70-80% compared to pre-war levels). The
resulting situation forced companies rely on foreign tradeof goods to reduce or completely stop production, further
crippling the Ukrainian economy.
Urgent de-bottlenecking of foreign trade routes is neededin order to resume economic activity and re-employ
workers, thus providing a lifeline to Ukrainian businesses.
Enhancements on the full length of the supply chain andacross all transportation methods are needed in order toaddress the current situation and unblock westward traderoutes, while ensuring there is enough downstream
capacity to handle additional cargo flows in theneighboring countries will also be key.
Newly emerging shifts in trade flows require the rethinking
of Ukraine’s road infrastructure. Several bordercheckpoints were already running beyond their maximum
capacity before the war and are now completely
overwhelmed by the outgoing flows of trade, as queues
sometimes amount to more than 1,000 trucks at theborder with Poland. Infrastructural overhauls andlegislative alignments between Ukraine and its
neighboring countries will be key for increasing transportcapacity. Further investments are needed for overall
improvements of the road network, which scores among
the worst in terms of quality and fatality rates (more than
twice the European average). Annual losses resulting fromcar accidents are estimated at around 3–4% of GDP.
Danube trade was only handling about 5% of exports
before the war and is currently running at maximum
capacity, with hundreds of railcars queuing for unloading at
the docks. Limited transshipment and storage capacity,
and an outdated trade fleet, are issues that need to beaddressed in order to increase throughput. Increasing rivertransport capacity is key particularly for bulk agricultural or
raw material shipments, as the high tonnage and low priceper tonne makes transport by rail or truck considerably
less profitable.
Ukraine’s rail network is among the most extensive inEurope, yet the need of massive overhauls along its wholevalue chain became ever more obvious after the start ofthe conflict. Transport volumes started to regain
momentum as of the end of summer 2022, yet the volumeof transported goods was still well below pre-war levels.

rolling stock fleet (average degree of depreciation ofaround 90%; average age of locomotives is more than
40 years), while outdated portions of the rail network andsorting stations further slow down traffic. Low
transshipment capacity at the border points and limited
bogie exchange capabilities between narrow (1,435 mm)
and wide (1,520 mm) rail gauges are proving to bea bottleneck for Ukrainian exports, as the sheer volume ofgoods is overwhelming the existing infrastructure.
As of August, around 29,000 railcars were still queueing at
the Ukrainian borders (although down from 41,000 in July),underlining the need of immediately overhauling existing
facilities to unlock the bottleneck at the EU borders.
Even in a scenario where we can take into consideration
the permanent reopening of maritime transport routes,
shipping will not take place in the same conditions as
before the war. Insurers will be charging a higher premium
to cover vessels sailing through mine-ridden waters, while
ship owners will be wary of sending their cargo ships
toward Ukraine instead of other safer destinations. The
war with Russia has shifted Ukrainian trade toward awestern path for decades to come, and conditions need be
put in place to ensure a smooth flow of cargo, which will beat the foundation of a self-sustaining economy.

Municipal
Eastern and northern municipalities have been hardest hit
by the war, while millions of citizens fleeing from affectedareas have amplified pre-existing shortcomings ofmunicipal infrastructure throughout Ukraine. Outdated
facilities, low energy efficiency, low quality, and low
coverage of heating, water, and wastewater services
describe the general state of municipal infrastructure in
Ukraine. Extensive investments are needed to improve thelevel of services for citizens, increase energy efficiency, andthus reduce reliance on natural gas imports. Given thescale of needs, a thorough baselining of current
capabilities and population flows is necessary, while
upstream support for the government in elaborating
a long-term approach is paramount.
Residential war damages were high, with around 150,000
housing units (~7% of total square meters of Ukrainian
housing stock) suffering partial or complete destruction
since the onset of the war, while less extensive damages
were recorded for municipal utilities objects.

Total volume of transported goods during September 2022
amounted to 11.7 million tonnes, compared to the
28 million tonnes transported during September 2021,
while overall volumes for the first nine months of the year
were down by 48% compared to 2021.
Internal cargo flows capacity is limited by an obsolete

16

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Figure 12: Regional distribution of destroyed or damaged housing stockin Ukraine, June 2022 data
Regional distribution by number of destroyed or damaged
housing stock buildings

13
7

8

19

12

10

4

1

2

25

14

6

5

23

18

11
9

3

21

17
15

16

24
22

20

15

26

1. Zakarpattia 98
2. Ivano-Frankivsk
3. Chernivtsi
4. Lviv 34
5. Ternopil 36
6. Khmelnytskyi
7. Volyn 2
8. Rivne 41
9. Vinnytsia 90
10. Zhytomyr 2,313
11. Kyiv 20,191
12. Kyiv City 282
13. Chernihiv 4,006
14. Cherkasy
15. Odesa 159
16. Mykolaiv 2,717
17. Kirovohrad 41
18. Poltava 29
19. Sumy 1,515
20. Kherson 2,360
21. Dnipropetrovsk 259
22. Zaporizhzhia 1,481
23. Kharkiv 3,230
24. Donetsk 70,818
25. Luhansk 11,294
26. Crimea

Source: BCG study

Nevertheless, shortcomings in municipal infrastructure
were ever present throughout Ukraine, with severe
deficiencies in terms of water and wastewater
management, municipal heating, and residential energy
efficiency.

buildings approaches 200 kWh/m2, almost 50% above
averages in countries with a similar climate such as Latvia(140 kWh/m2). The poor use of energy increases relianceon fossil fuels of Russian origin, with natural gas imports
rising until 40% of total needs in certain periods.

It is estimated that half of Ukrainian citizens have noaccess to wastewater disposal systems and one third ofwastewater is discharged into water bodies without priortreatment, while less than two-thirds of the population
have access to drinking water supply systems. Moreover,energy efficiency for water and wastewater utilities in 2021
was 15–25% below 1996 levels.

While it was already clear that at-scale repairs andmodernization were highly necessary in the municipal
infrastructure sphere, the emerging population shifts
toward the central and western parts of the country havedone nothing else but amplify pre-existing needs forinvestments. The estimated 5.9 million people currently
displaced in Ukraine have exacerbated municipal
infrastructure gaps, as catering to the primary needs ofinternal refugees in the short term and elaborating anadequate reconstruction strategy on the basis of
population flows become paramount.

The heat supply system is characterized by highinefficiencies in terms of energy usage, with network heatlosses estimated at around 20%. Despite only one-third of
the households being connected to the district heating
systems, the heat supply sector still accounts for half thegas consumption in Ukraine.
Excessive usage of fuel and energy is a characteristic of
Ukraine’s municipal infrastructure. Most of the buildings
date from before 1990 and have not undergone major
refurbishments. Thus, the average energy consumption of

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

Fuel
Fuel shortages have crippled the Ukrainian economy since
the onset of the war, as the vast majority of petrol products
were imported, with most of them coming from Russia andBelarus. Domestic production has been completely

17

impaired as a result of the conflict, and new supply routes
need to be enabled with European partners in order to end
the current crisis.

With an existential crisis at hand, Ukraine appealed to its
Western partners, and fuel imports from the EU increased
from 10% before the war to 100% as of June. Import of oil
products was down by about 62% y-o-y as of May, as
neighboring countries made efforts to supply Ukraine with
fuel via rail, road, river, and pipeline, and by the end of
August imports almost doubled and bounced back to an
estimated 710,000 tonnes.

Reliance on foreign petrol products came at a high cost for
Ukraine after the onset of the war, as 80% of its fueldemand was satisfied via imports, most of them comingfrom Russia and Belarus. Additional routes from Lithuania(rail via Belarus), Romania, and Azerbaijan (sea via Odesa)
were blocked, leaving Ukraine with only a small portion of
its European imports still at hand, while the remaining
20% of pre-war fuel supply was satisfied through local
production. However, Ukrainian fuel production capacity
was dealt a decisive blow when the sole remaining local
producer, Kremenchuk refinery (40% of local petrol anddiesel supplies), was taken offline in April following rocket
attacks.

With border queues sometimes extending over several
kilometers, de-bottlenecking petrol transport routes will be
instrumental in supplying Ukraine with the necessaryamounts of fuel. Imports via pipeline or via the Danube
could help further increase volumes, ensuring there isenough specialized rolling stock to transport the needed
quantities via rail or road will also be a key factor in thefuel supply chain.

Limited availability of fuel led to hourly-long queues at
petrol stations, rations of 10 liters per driver, and pricefluctuations of up to 40% compared to pre-war levels.

Figure 13: Imports of oil products, 2021 average monthly data, May 2022,
and August 2022
Monthly oil product imports [kilotonnes]
-62%
1,010

+84%
710

Imports

380

2021 (avg)

May 2022

August 2022

Source: Ukrainian National Service of Statistics, BCG study

EnergyThe energy sector has suffered direct losses due to the war,as key facilities have been either occupied or destroyed by
the invaders. Direct damage to energy facilities and theoccupation of key areas of Ukraine has prompted national
electricity production to fall by almost one-third since theonset of the war, while targeted rocket attacks at the
beginning of October have crippled Ukraine’s capability toexport energy to the EU.
Nuclear energy sources are estimated to have lost close to18

half of their production capacity following the loss of theZaporizhzhia Nuclear Power Plant, but as remaining
facilities ramped up their activity, only a smaller decreasein production has been recorded. Renewable production
was even more affected by the war, with production
decreasing by 50% as a large proportion of renewableenergy source (RES) facilities are installed in regions where
active hostilities are taking place.
The decrease in production capacity, however, was met by
a comparable decrease in demand, and Ukraine succeededin maintaining its status of energy exporter.

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Figure 14: Operational capacity of power generation per source; total
electricity production, October 2022 data
Return to levels of energy production specified in the graph only possible once intensified attacks on energy
infrastructure are resisted
Distribution of operational capacity of power generation, MW
13.9

5.9

11.2

10%
43%

4.8
4% 7%

6.0

1.6

4%
35%

18%

50%

77%

69%

61%

46%

CHP

TPP

HPP

Solar

Wind

Total

Destroyed capacities

Capacities in occupied territories and in the active war zone

Other RES

Nuclear

Hydro

0.9
GW

Natural Gas

2.1
GW

2.5 GW(~15%)

11.6 GW
9.2
GW

6%

NPP

17.1 GW

94%

93%
57%

43.5

14%

12%

UA electricity production [GW]-32%

1.4 GW(~13%)

0.9
GW

0.3
GW
6.8
GW

0.6
GW

4.3
GW

0.5
GW

3.2
GW

7 Oct 2021 7 Oct 2022
Available capacities

Coal

Source: Ukrenergo, The National Council for the Recovery of Ukraine from the Consequences of the War’s working group’s analysis

Investments are now needed to ramp up production
capacity once demand will begin rising towards previous
levels, while strengthening the internal grid allowing
transport from generators will prompt increases in export.
This will not only strengthen Ukrainian resilience, but also
benefit importing countries (namely countries of the EU).
The energy sector remains nevertheless plagued bychronic issues related to the inefficient use of energy, as
outlined earlier in the diagnosis on municipal
infrastructure, by limited domestic energy production andby intensified attacks on energy infrastructure.
Moreover, half of Ukraine’s energy infrastructure wasdestroyed in attacks conducted by Russian forces inautumn 2022. It causes 40% of Ukraine’s population to bein immediate humanitarian need. Secondly, the destroyedenergy grid infrastructure must be rebuilt with support andassistance of Ukraine’s international allies to securecountry’s independence. The winter months are
considered critical.
Investment needs on a 10-year horizon for fostering energy
transition and strengthening the energy system arecurrently estimated at $100 billion by the NRP.

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

Summary
While the Russian invasion has caused considerable losses
to Ukraine both directly, and indirectly, a wide array ofinternal and external factors has further amplified thecrisis. Chronic shortcomings in municipal infrastructure, an
outdated transport infrastructure and global-wide pricehikes for fuel and energy in addition to supply chain
disruptions have brought parts of the economy toa standstill.
By merging the wide view on Ukrainian socioeconomic
dynamics with the granular deep dives into key sectors,
a comprehensive image thus crystalizes asinterdependencies become visible and economic enablers
can be identified.
Given the sheer size of investment needs, a forwardlooking and holistic approach is thus required to ensure
Ukraine can rebuild on a strong foundation. This entails
focusing a limited pool of funds and support toward themost impactful levers, which can ensure a self-supporting
economy in the mid-term and a prosperous one in the long
run.

19

Why the recovery in Ukraine needs
immediate and bold support

S

ince the beginning of the Russian invasion, theinternational environment has been strongly
supportive of Ukraine, with help ranging fromindividual material support to large-scale supranational
grants. Not only moral and humanitarian considerations
justify the scale of support, but also the fact that Ukraine’s
economic interest is aligned with the global one of freedemocracies. As a significant exporter of commodities,
Ukraine can enhance global food security and provide
valuable minerals, including rare earth metals that are
indispensable for technology production and for enabling
green transformation. Finally, Ukraine has also traditionallybeen a net exporter of power and a potential
transportation hub for neighboring parts of Europe.
Overall, Ukraine is a significant partner on theinternational scale, strengthened by its candidacy status
and future membership to the EU.

1. Geopolitical considerations
Ukraine’s recovery is of international concern due to its
significant geopolitical influence, owing to economic,
trading, and strategic reasons.
A sound recovery would benefit both Ukraine and the EU20

as their markets continue to become increasingly
integrated. Ukraine already plays a key role on the regional
labor markets, with a workforce of around ~1.5 million in
Poland and about ~0.5 million in Germany, while it
becomes increasingly likely that a substantial portion ofnearly 8 million refugees will remain in the EU for the
long-term. The recovery plan should consider creating theconditions to enable Ukrainians to access more developed
markets and for international investments to improve thelocal labor market of Ukraine. Such a setup would facilitate
best-practice sharing, spreading of know-how, andincreased social mobility. Ukraine’s access to EU’scommercial and financial markets through regulatory
convergence will further benefit both parties, as it would
significantly smoothen both international trade and laborflows.
Ukraine’s position as an economic bridge between Asia
and Europe was fully suppressed by the war. Apart from
hindering the traditional gas transport route to Europe,
Ukraine’s position within the Chinese Silk Road Economic
Belt has deteriorated as well. Thanks to its coastal span,
Ukraine has an excellent position for long-distance sea
trade and can fully leverage the benefits of low-cost
maritime shipping. However, following Russia’s seaport
blockade, logistic costs for Ukraine’s crucial exports rose

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

significantly, as rail transport cost per tonne is estimated to
be up to eight times higher than it is for deep-sea shipping.
The lack of global markets access dealt a severe blow to
the Ukrainian economy, particularly to the key agriculturaland industrial sectors, where enterprises had to forcefully
decrease production due to their inability to store or ship
goods.
Bolstering Ukraine’s resilience and enabling its economic
recovery would diminish Russia’s possibilities of further
escalation, potentially stabilizing the region. With Ukraine
heavily dependent on foreign aid (mainly to bridge liquidity
issues), de-bottlenecking its economy becomes paramountfor safeguarding its sovereignty and thwarting the Russian
threat.

2. Ukraine as an important exporter
By zooming in on Ukraine’s export statistics, its vital roleon international markets becomes evident. The country’s
potential revolves around food, minerals, and energy.

2.1 Food
Ukraine’s leading position on the global grain market,
combined with its inability to export its products, were at
the root of recent worldwide turmoil. Because Ukraine isa key agricultural exporter (see Figure 172), the seaport
blockade was followed by a global-wide increase in foodprices. This left the most vulnerable countries exposed andhad a major role to play in Sri Lanka’s economic crisis,
worsened Afghanistan’s humanitarian crisis, and were at
the root of the protests toppling Pakistan’s government.
As David Beasley (executive director of World Food
Program, 2022) affirmed: “Ukraine grows enough food tofeed 400 million people on planet Earth. There … will bea supply issue.” One of the recovery goals must be toensure that the sector receives enough supplies,
experiences fewer bottlenecks, and can export freely atlast.3Figure 15: Ukraine’s position on global agricultural market (2021)
Share of global market
Sunflower oil

Size [B€]
37%

5.3

Maize

11%

4.9

Barley11%

1.0

Rapeseed

9%Wheat and meslin

8%

Oil cake

3%

Poultry meat

2%

Soybeans

1%

1.1
4.0
1.3
0.6
0.5

2. Source: International Trade Centre, Bank Pekao
3. Also, assuring sufficient supplies on the global food market supports efforts on taming inflation

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

21

2.2 Minerals
Secondly, Ukraine possesses and produces a unique
combination of scarce raw materials that are primarily
used in strategic and highly specialized industries such as
microelectronics, aerospace, climate tech, and construction
tech. As these industries are rapidly developing, theimportance of Ukraine’s mining output will grow alongwith them. Ukraine already ranks among the world’s top
10 producers for over 10 commodities, while it holds
a leading position in rutile, scandium, manganese,titanium sponge, and gallium production (see Figure 164).
Enabling Ukraine to further develop its specialized mining
activities can help alleviate the worldwide dependence ona few concentrated producers (e.g. China, Russia).

Figure 16: Ukraine’s position on the global minerals market (2021)
Share of global market

Rank globally

Rutile15%

Scandium

7%

Ilmenite

3
3

5%

7

Kaolinite

4%

7

Maganese3%

5

Iron ore3%

6

Titanium sponge

3%5Graphite (natural)2%

6

Ammonia2%

13

Gallium

1%

Extraction

2.3 Energy
Furthermore, Ukraine has the potential to alleviate theexisting energy crisis. Pre-war, Ukraine’s power generation
was well-diversified with roughly 30% share each for coal,natural gas, and nuclear, while the share of renewables was
growing rapidly. It was on the path to become a European
green-energy success story.
Despite the devastating impact the war has had on power
production, Ukraine maintains excess capacity. Although
its power production capacity decreased by 32% as of
7 October5 y-o-y, the demand followed suit, and in June
2022 Ukraine claimed to be capable of exporting ~2.5 GWof energy to Europe. However, in the aftermath of thelarge-scale missile strikes in October 2022, Ukraine wasforced to halt its energy exports and focus on stabilizing its
national network. Should Ukraine succeed in maintaining

Production2

its excess production capacity, it could play a significant
role in lowering Europe’s reliance on Russian energy.
Moreover, the Ukrainian reconstruction is also a chance torebuild its industry and energy production facilities undernet-zero emissions standards, enabling convergence
toward the Paris Agreement targets.

3. Prioritizing humanitarian aid
The international community needs to rally around helping
Ukraine with its humanitarian needs to boost earlyrecovery efforts—including rebuilding housing, maintaining
jobs, satisfying basic energy/fuel needs and sustaining thequality of health care, education, and transport, and with
providing relief for over 5.9 million Ukrainians displaced by
the war.

4. Source: USGS – Mineral Commodity Summaries 2022 (Gallium based on report from 2020), Bank Pekao
5. Comparing 7 October 2021 vs 7 October 2022 (~25% drop of nuclear power production; ~60% drop in renewable production)

22

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEThe impact of war on the well-being of Ukrainians is dire,with over 61% of the population directly affected by thewar, ~5 million jobs lost (close to one-third of total labormarket), ~150,000 housing units destroyed, and 25% offamilies in need of food. Basic logistics and municipal
infrastructure in eastern parts have been severely
damaged, while the economy and the level of prices acrossthe whole country remain largely unstable. Therefore,a full-fledged recovery is key for satisfying the urgent
humanitarian needs and for alleviating the impact of war
hostilities.
In addition, the recovery is also an opportunity to elevate
local living standards in the mid- to long-term throughboth:a. Channeling investments towards projects such as clean& wastewater management, andb. Improving the building blocks of a functioning society
such as ensuring efficient procurement processes orlowering corruption
A timely recovery would allow for restarting the economic
reforms and re-embarking on the path toward
a prosperous and sovereign state. This would create theconditions for stability and predictability within theeconomy, supporting Ukrainian convergence toward
European living standards.

Conclusion
The Ukrainian recovery is a daunting and complex taskthat requires exceptional effort on a national, regional andinternational level. Early actions need to go hand in handwith thorough planning.
Therefore, in order to ensure the adequacy of planned
recovery measures and assure their proper understandingby the stakeholders, the Rapid Damage and Needs
Assessment (RDNA) is being regularly updated by the
Ukrainian Government, the European Commission, theUnited Nations and the World Bank, with the next update
expected very shortly. While the RDNA focuses on direct
damages, and is an excellent tool to aid the rebuilding of
Ukraine, it is also clear that the impact of the war in
Ukraine extends far beyond the national level, and is also
a global concern.
Acknowleging the full breadth of the significance behind
the Ukrainian recovery will be key when designingrecovery-related actions and ensuring full involvement of
the concerned stakeholders.
As seen from the geopolitical, export, and humanitarian
vantage points, a stable and prosperous Ukraine canbenefit and have a multiplier effect on economies from allover the world.

Humanitarian aspects must remain a priority for theinternational community, as thoughtful financial
structuring needs to be combined with prompt actions inorder to ensure minimal basic services for a population indire need.

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

23

Suggested principles to help Ukraine

Having compiled a very detailed, holistic picture of thesituation in Ukraine, BCG and EIB have identified
key pressing issues. We jointly suggest following six
key principles when approaching the Ukrainian recovery

01

Supporting Ukraine—
starting now

02

strategy. Aligning on these values will be crucial for
facilitating coordination of the Western response.

International financial institutions need to double down theirefforts more than ever and further their investment inUkraine despite the ongoing war. While remaining in line with
their mission and mandates, international donors could
initially focus on western regions free of hostilities, wheremost of the economic activity has now shifted. followed by
support of liberated areas in eastern parts of the country inclose cooperation with local authorities). Critical investmentsin the east can be carried out after close consultations with
the Ukrainian government, while remaining mindful of war
risks.

The survival of Ukraine as a sovereign state is a prerequisite
for future recovery and long-term modernization. A concerted
effort is needed not only with the involvement of financial
institutions, but also from the international community as
a whole. Ensuring the short-term resilience and functioningof Ukraine as an independent and democratic state is thefirst step in its endeavor toward long-term recovery.

Bolstering Ukraine’s
resilience

03

Investment focus needs to be aimed at key areas andenablers that can catalyze economic recovery. As investment
needs far outweigh availability of funds, international
financial institutions need to identify and focus on the mostimpactful investments that can de-bottleneck the Ukrainian
economy and have the potential to lay the foundations ofself-sustainability in the long-term.

Focusing on key topics
for maximum impact

24

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Following recent developments, it has become ever clearer
that the future of Ukraine is now tied to integration withother democracies, especially with those closest
geographically to Ukraine. Facilitating closer cooperation andintegration with the EU is a net gain not only for Ukraine andEurope, but also for the entire democratic world, as itstabilizes the region and vital global trade dependencies.

04

Facilitating EU integration
It is paramount that ownership for the reconstruction effort
lies on the side of Ukraine, as this strengthens Ukrainian
sovereignty, resiliency, and accountability. While internationalorganizations will need to advise, seek alignment, and ensure
monitoring and transparency, ultimate accountability will beon the side of Ukraine, which will have to become
independent from international aid at some point after
peace is ensured.

05

Ensuring UA ownershipand accountability

06
Ensuring alignment
with other internationalorganizations

As multiple organizations are involved in Ukraine,communication and cooperation are key for generating the
maximum potential impact. IFIs should channel their efforts
where they can bring the most value, building on successful
past investments in Ukraine and their core expertise.
Through strategic coordination, IFIs can align efforts among
each other and complement their offerings to provide
Ukraine with comprehensive and holistic aid. There is highpotential of IFIs joint participation in the overarching
Ukraine support framework, tightening existing partnerships
and forging new ones while joining any forming international
coordination efforts.

The presented principles lay the foundation for the prioritization of initiatives described in later sections and aremeant to provide overarching guidance for investment in Ukraine in the foreseeable future. They are seen as key
pillars in forging the Ukraine Recovery Strategies.

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

25

Coordination on Ukrainianreconstruction

Ukraine reconstruction and development efforts,
because of the damages caused by the war, will
require full dedication and joint efforts of allengaged parties from both within and outside of the EU.

informed parties in every process of every project that isplanned and then implemented.

From the IFIs’ perspective, a successful implementationand maximization of impact on Ukraine is directly
dependent on the strategic coordination of the recovery
efforts, especially between EIB, the World Bank, andEuropean Bank for Reconstruction and Development, as
well as other international financial institutions (KfW, JICA,etc.). Sharing knowledge, joining capabilities and skills aswell as having clearly stated roles within the reconstruction
framework, in line with the expertise and experience ofeach IFI in Ukraine is vital.
It is recommended that all engaged IFIs, in a joint session
dedicated to operations in Ukraine, split their roles and set
up terms of their cooperation before any action is taken, toavoid redundant misconceptions. Additionally, the timelineof projects implementation should be established.
The RACI framework could be used to establish roles
between engaged IFIs. The framework helps to structure
and identify responsible, accountable, consulted, and26

Prioritization of efforts in Ukraine
Needs for Ukraine’s recovery were assessed by the National Recovery Council (NRC). The NRC was established by
the Ukrainian government as an advisory body to the president, Volodymyr Zelensky. One of the main roles of the
NRC was to create the Post-War Recovery and Development Plan for Ukraine—Ukraine’s Recovery Plan (UNRP),
published on 6 July 2022.
The initiatives defined by the National Recovery Council
include projects across multiple sectors and different time
horizons as well as estimated funding needs. However, theplan doesn’t consider the prioritization of the initiatives,
which would allow to translate the UNRP into actionable
programs, with a defined timeline.
Therefore, EIB and BCG initiated the analysis of all projects
defined by the Ukrainian National Recovery Council, in an
attempt to set priorities and group the initiatives into
programs that can later be translated into a strategy.

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINE

Added initiatives
BCG team analyzed the UNRP plan after completing thediagnosis of the situation in Ukraine.
To ensure completeness of the UNRP document, BCG
proposed adding 15 new initiatives. The initiatives relate to
the economic and social environment sector,
infrastructure, and energy & environment. The additional
initiatives were carefully defined based on multiple
interactions with (i) EIB teams; (ii) external experts

specialized in Ukrainian economy, infrastructure, energy;(iii) public-sector BCG experts experienced among othersin EU institutions, cooperation with IFIs (WB, EBRD), andall relevant sectors of economy. Over 60 key experts were
engaged in constructing the additional initiatives.
These were later assessed in the assessment frameworkusing the same criteria as for all other initiatives. Please
see the added initiative list in the table below.

Funding need($B)
Time horizon

Project description
De-bottleneck traffic along main internal routes by increasing road capacity inaccordance with existing population flows

15

Short-term

Improve road conditions focusing on increasing capacity and safety measures

12.5

Mid-term

Expand logistic energy bottlenecks that emerged due to the conflict (e.g., increase grid
capacity of old grids or generators)

10

Short-term

Explore energy efficiency (e.g., reconstruction of old grids or generators)

5Long-term

Invest in projects focused on decarbonization of existing plants (e.g., carbon capture
technologies to lower emissions from TPPs & CHPs)

3

Mid-term

De-risk commercial lending through guarantees for banks and other lenders to support
investment (e.g., infrastructure lending, SMEs, corporations, FDIs)

2.5

Mid-term

De-risk private lending through guarantees for mortgages (given by banks) to support
investment in residential projects

2

Mid-term

Support export enablement initiatives (e.g., through loans, trade financing, guarantees)

1.5

Mid-term

Invest in forestry—sustainable management and reforestation

1.5

Long-term

Finance next year’s harvest (seeds, fertilizer, fuel)1.5

Short-term

Strengthen digital infrastructure (e.g., rebuilding affected cell towers, implementing
digital monitoring in road and rail, etc.)

1

Mid-term

Fund public service facilities in areas with increased population (schools, health carefacilities)

1

Short-term

Fund initiatives to support relocation, restart, reconversion initiatives (through loans
and guarantees for investment and working capital)

1

Short-term

Finance alternative grain storage solutions for upcoming harvest (not necessarily atborder)0.5

Short-term

Improve cross-border infrastructure on EU side

0.1

Short-term

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

27

Needs assessment
To understand the urgency and impact of all initiatives andtranslate them into actionable projects, a custom-tailoredassessment framework was created following expert
consultations, which considered a wide array of both
qualitative and quantitative aspects of Ukrainian needs.

Figure 17: Assessment framework building blocks
Ukraine needs

Economic dimensions

Strategic dimensions
Implementational dimensions

GDP impact

Feasibility

Employment impact

War-time risk

De-bottlenecking the economy

Societal dimensions
Innovation impact
Climate change impact
Health care impact
Educational impact
Humanitarian impact
Resilience

Expert assessment based on description and

Quantitative assessment of the estimatedscope of initiatives

relative power of initiatives to contributeto growth in GDP and jobs

A list of multiple criteria was created:
Assessment framework criterion

Criteria type Definition

Employment impact( jobs created)

Quantitative

Additional jobs per unit of monetary investment generated by the initiative

GDP impact

Quantitative

Additional GDP per unit of monetary investment generated by the initiative

28

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEDe-bottlenecking of theeconomyQuantitative

Extent to which the initiative would address challenges hindering the
economy since the onset of the conflict

Feasibility

Quantitative

Implementation complexity and capacity requirements; including probability
to fail/not fully deliver

War-time risk

Quantitative

Risk of the effects of the initiative being damaged by military activity

Innovation impact

Quantitative

To what extent the initiative supports innovation in UA (product innovation—
improvements in a product or social offering; social innovation—new ways of
doing things to meet social needs; or process innovation—changes andimprovements in production and delivery methods)?

Climate change impact

Quantitative

To what extent will the initiative (positively or negatively) impact climatechange issues in UA or globally? Can be measured in additional GHG
emissions emitted (or saved) because of the project

Health care impact

Quantitative

To what extent will the initiative impact the healthcare system in UA (in termsof access—number of beneficiaries and procedures; outcomes/quality ofservices—results of medical procedures, patient satisfaction; health careawareness/ preventative care; affordability of healthcare)?

Educational impact

Quantitative

To what extent will the initiative improve education in UA (in terms of access,outcomes—knowledge, skills developed, quality of processes)?

Humanitarian impact(food, shelter, first aid)

Quantitative

To what extent will this initiative bring humanitarian help to war victims(in terms of food, shelter, first aid)?

Resilience

Quantitative

To what extent does this initiative strengthen the resilience (economical,
geopolitical, military) of UA and help it withstand the ongoing conflict?

All initiatives that were eventually considered wereassessed using a dedicated methodology based on
previous experience in countrywide reconstruction
initiatives.

the long-term. Every project in the UNRP had a start andend date defined. The assessment framework took that
into consideration and grouped initiatives into three time
horizons:

The scoring system was based on the analysis of economic
quantitative impact and expert strategic judgment. The
logic of the assessment was based on the following steps:• Short-term (2022–2023)• Every initiative was given a score (1–10) against all
criteria.

• Long-term (2028–2032)• Depending on the time horizon of the initiative, a weight
for each criterion was applied.
• The sum of the weighted scores was the final score of
the initiatives.
• The total score (in a range 1–10) indicates the relative
impact of the initiative.
Furthermore, every criterion was assigned a time horizon
weight, based on the reconstruction needs. Some of theneeds (for example war-time risk) are more significant in
the short-term, while other (for example climate change) in

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

• Mid-term (2024–2027)

In the coming 12 to 15 months, it is critical to focus onhumanitarian needs (first aid, shelter, food), economic andgeopolitical resilience, and de-bottlenecking of theeconomy.
In the mid-term perspective, main focus shifts toward GDP
and employment creation, followed by continued efforts tode-bottleneck the economy and strengthen Ukraine’s
resilience.
By 2032, the majority of projects would be dedicated tofurther economic growth.
In the short-term (2022–2023) the estimated funds needed29are ~$110 billion, spread across ~30 projects. Mid-term
recovery assumes to be spread over 2024–2027, where therequired funds double (~$210 billion, ~60 projects). In thelong-term, until 2032, the funds are estimated at ~$500
billion (80–90 projects).

Study on prioritization of support
Prioritized initiatives
The assessment framework (detailed in the previous
chapter) was applied to all initiatives brought forth in the
UNRP and proposed by BCG, following consultations with
Ukrainian experts and industry experts.
The analysis divided the already well-chosen initiatives into
three impact categories, the top ~$150 billion being ranked
as high priority based on estimated potential financing in
the next 10 years.

Figure 18: Distribution of funding needs by assessed impact and time
horizonFunding size ($B)

Funding need value by impact potential ($B)

825

458

155

213

155

21%

213

73%

73%
62%

458

14%

18%
17%

14%

Low

Medium

High

106

45

26

9%

Total funding needOut of total ~$825B funding need,~$150B selected as high impact(with $50B as a backup)
High impact

High potential—initiatives with highest score of cumulativevalue up to $150B funding needMid impact

Low impact

Short-term urgent needs

Long-term modernization

Mid-term recovery

Note: Projects qualified as high-, mid-, low-potential based on their score and their cumulative funding size: high (up to $150B), mid ($170B–$400B),
low (>$400B). Time horizons qualified based on NRC timeline: short-term urgent needs (2022–2023), mid-term recovery (2023–2027), long-term
modernization (by 2032). Source: NRC Recovery Plan, BCG analysis

The highest impact initiatives are listed below.
(1 being the highest ranked, 26 being the lowest ranked
among the assessed initiatives)

30

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINETop 26 Ukraine needs for ~$150B:
Rank

Initiative

Needs ($B)

0

Facilitate UA government stability with macro-financing

1

Support export-enablement initiatives (e.g., through loans, trade financing, guarantees)

1.5

2

Introduce wartime government grants, loan guarantees, and interest rate reduction

5

3

Reparation and modernization of sorting stations on key routes (particularly export ones)

0.2

4

Oil, oil-products emergency stock for 30+ days

1.2

5

Assess scope for deregulation through running Red Tape reduction program withcrowdsourcing of ideas and optimized process of regulations review, establishing systematic
regulatory burden measurement and regulatory impact analysis of draft laws and regulations

0.1

6

Construction of EU cross-border agricultural storages and terminals

0.2

7

Strive for EU integration, incl. ensure synchronization of Ukraine regulation with Copenhagen
criteria, secure access to markets

0.1

8

Finance next year’s harvest (seeds, fertilizer, fuel)1.5

9

Increase labor mobility through (a) funding the transfer to other regions for job purposes, (b)simplifying regulations for foreigners’ employment in Ukraine and Ukrainians’ employment
abroad0.3

10Modernize water and wastewater management system42

11De-risk commercial lending through guarantees for banks and other lenders to support
investment (e.g., infrastructure lending, SMEs, corporations, FDIs)

2.5

12

Construction of 200 km of 1,435 mm rail and 330 km of 1,520 mm rail to the EU border andDanube1.4

13

Establish procurement practices for Reconstruction projects fully aligned with EU directives
and guidelines

0.1

14

Expand the functions and mandate of Investment Promotion Agency to proactively solicit
FDIs for Reconstruction investment projects

0.1

15

Modernization of 12 existing EU road border points and construction of three additional
ones

0.1

16

Improve cross-border infrastructure on EU side

0.1

17

Maintenance of 20+ freight car relocation equipment from 1,520 to 1,435 mm rail track

0.1

18

Fund initiatives to support relocation, restart, reconversion initiatives (through loans andguarantees for investment and working capital)

1

19

Expand logistic energy bottlenecks that emerged due to the conflict (e.g., increase grid
capacity of old grids or generators)

10

20

Professional Armed Forces of Ukraine, other components of the defense forcesout of scope6

6. Out of this study’s scope. Generally a key initiative

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

31

21

Comprehensive rearmament of the defense forcesout of scope

22

Further develop Diia.Business as a one-stop shop and key repository of information for SMEs

0.1

23

Establishment of the Defense Technology Agency and Defense accelerator (Diia Tech &Defense)0.5

24

Secure macro-financial stability: ensure stability of budget deficit and banking system while
maintaining healthy debt level70

25

Launch PPP re-employment program with reskilling part (physical and financial
infrastructure, employers funding matching), up to 1 M people coverage

1.5

26

De-bottleneck traffic along main internal routes by increasing road capacity in accordancewith existing population flows

15

The chart below focuses on highest-ranked Ukraine needs.
The priorities are non-exhaustive and there could emerge
other topics and investment initiatives beyond the below.

Figure 19: Zoom on top ~$80B high-impact initiatives
Ukraine need and potential impact (average score 1–10 independently weighted
by time horizon)
Ukraine need & potential impact (average score 1-10 independently weighted by time horizon)
7
De-bottlenecking road capacity

Export enablement

6

Oil stock for 30 days

Labor mobility

Rail stock modernization
Relocation initiatives

Modernization of EU
road border points

5

Energy bottlenecks
Restoration of infrastructure
Ecomodernizationof enterprises

Rail reconstruction
Rail stock renewal

Procurement
guidelines

Rail integration

Synchronization
with EU project
criteria

PPP re-employment program

Danube ports

Water and wastewater

Financing next
year’s harvest
X-borderargi-storgaeDe-risk commercial lending

Road safety

4

Biofuels

Rail modernization

Retail lending programs

High-speed rail Kyiv–Warsaw

City transport

0

3

7

8

9

10

EIB fit (average score 1–10 independently weighted by time horizon)
Size of the funding need, $B
Modernization

32

BCG-added initiatives

Business enablement

De-bottlenecking infrastructure

EU alignment

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEEnablers
For Ukraine to recover, cooperation with international
partners will be a necessity—the EU being the closest,
biggest, and strongest one. The cooperation will amplify
cross-border flows of goods and increase workforce
mobility and cooperation. For both to be successful,
Ukraine needs to align with the EU on the regulatory level.
• EU alignment: two of the initiatives were prioritized toenable EU alignment:• 5.9. Establish procurement practices for reconstruction
projects fully aligned with EU directives and guidelines• 2.A.1 Strive for EU integration, incl. ensure
synchronization of Ukraine regulation with Copenhagen
criteria, secure access to markets.

institutional capacity—the ability to screen and monitor
beneficiaries, procure efficiently, and implement reforms.
Second—Ukraine might need to import technical expertisefor areas where it is lacked it domestically. Third—
Ukraine’s construction sector’s capacity to implement new
projects needs to be analyzed, as potential labor andmaterials shortages could hinder the absorption of theinternational donors’ funds.
While Ukraine is facing unprecedented financing needs,
the international community is willing to undertakea concerted effort and support its recovery. It is paramountthat donors’ ambitions are met by proportional Ukrainiancapacity to manage and absorb the additional debt, witha creative financing structure and efficient stakeholder
cooperation as imperatives for success.

• Social and humanitarian support: A certain
percentage (10%–25%) of funds will be opportunistic onenablers.
Capacity to absorb funding
Enormous financing needs and international donors’
willingness to provide ample support generate an
immediate need to assess Ukraine’s additional debt
absorption capacity, which might be limited by thefinancial capacity to service it or the technical ability toprocess and implement projects.
Financial absorption capacity can be assessed byunderstanding the maximum levels of debt Ukraine cansustain and possibility to return to capital markets
With 2022 GDP contraction estimated at ~30%, the Debt/
GDP ratio is forecasted to reach ~90% by the end of Q4.
Even recovering Ukraine’s GDP to the 2020 level andallowing the Debt/GDP ratio to approach 100% would only
cover less than $100 billion in additional debt, while thefigures of estimated needs (~$750 billion according to the
NRP) would still dwarf those of the contracted debt.7
Moreover, as the war severely obliterated Ukraine’s
financial health, its debt fundamentals deteriorated,preventing it from borrowing from traditional financial
markets. This makes meeting its financing needs
dependent on either domestically issued war bonds orinternationally subsidized loans/grants (responsible for~50% of state budget since the beginning of the war). Even
if Ukraine was able to borrow at 6% (subsidized rate in $ or€) and would decide to double its government deficit, it
could only serve additional ~$125 billion while maintaining
liquidity.
Technical capacity to absorb additional debt depends on
several factors. The first constraint relates to the

7. Source: Current debt at $93B (2022 Q2, Ministry of Finance of Ukraine).

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

33

Recommendations
The vast amounts of reconstruction needs require certain
adaptations to be made, which would increase beneficiary
absorption capacity and smoothen the overall lending
process. Lending experience in Ukraine allows to identify
several levers which could, if correctly implemented, havethe potential to significantly improve end results:• Establishing holistic country-level reconstruction
strategies for paramount areas and aligning promotersand stakeholders across sectors will be key for ensuringthat the currently limited funding supply is channeledtoward areas of maximum impact and will remain
relevant in the long-term. Distribution of funds needs
to be adapted to emerging population and economic
flows while also taking into account absorption andimplementation capacity of the end receivers.
• Providing loans directly to the beneficiary undera state guarantee can significantly improve
distribution flows while also increasing ownership of end
receivers. Every lending process should be supportedby the granting IFIs, as past experience has shown that
granting funds via the state budget can slow down thelending process due to the involvement of additional
intermediaries and legislative procedures.

• Organizing the acquisition procedure througha simpler procurement process heavily supportedby the lending IFIs, particularly for mass-purchases ofmachinery or materials.
• It could allow for the swifter implementation of subprojects under the umbrella of programmes.
• Alignment between Ukraine and IFIs will be essential
in ensuring swift project implementation. Establishingand training project implementation units at thepromoter level will lay the foundations for an efficient
long-term collaboration between Ukraine and IFIs,
as well as further convergence with the EU, that will
create space for strategic enablement and economies
of scale (including technical assistance and monitoringsynergies). IFIs can thus engage in collaborations within
their areas of expertise and forge a common approach
toward the reconstruction of Ukraine. The overallfunding could be split across the key programs andenablers.

• Dispersed procurement procedures have consistently
proven to be a bottleneck in the lending cycle.

34

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEEUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

35

36

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEEIB management team:Markus Berndt
Acting Managing Director of EIB Global,
Head of Operations
Laura Piovesan
Deputy Director General of Projects Directorate,
Leader of Sustainability and Quality Management
Lionel RapailleDirector-Lending Operations in EU Neighboring
Countries
Jean-Erik de Zagon
Head of Representation to Ukraine
Rafal Rybacki
Head of Division; Public sector lendingin Eastern Europe

Marion Hoenicke
Head of Division Lending Eastern Neigh. & Cent. Asia
Nina van Doren
Head of Corporate Lending in EU Neighborhood
Countries
Edward Claessen
Head of Unit – Infrastructure Funds
Marco Marrone
European Investment Fund
Jean-Jacques Soulacroup
Head of Eastern Countries Corporate Lending
Operations

BCG leadership team:Franciszek Hutten-Czapski
Managing Director & Senior Partner

Kacper Ostrowski
Partner

Oliver DanyManaging Director & Senior Partner

Pawel Godek
Partner

Laszlo JuhaszManaging Director & Senior Partner

Tim Figures
Associate Director

Lukasz Rey
Managing Director & Partner

Over the course of the project, BCG engaged with over 60 participants. We want to extend further thanks to everyone
involved in the project, especially representatives of EIB who made the project possible:
EIB Ukrainian lending team:
Anastasiia Kharlan
Loan Officer and Business Analyst

Oksana Remiga
Loan Officer; Municipal projects

Herve Guenassia
Loan Officer; Energy projects & transportation

Stella Renita
Loan Officer; Kiev City

Henry Moykkynen
Loan Officer; Digital sectors in eastern Europe

Andrii Dubovyk
TA consultant

Violaine Silvestro
Loan Officer; Municipal projects

Luca Ponzellini
Senior Officer; Intermediary lending in Ukraine

Kinga Soltesz
Loan Officer; Digital sector

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

37

EIB technical experts:
Piers Vickers
Leading UA in technical assessment teamMihail Juc
Senior Engineer; Enviro. & Nat. Resources Department
Marco Beros
Senior Sector Eng.; Water and Waste division
Pavel Novak
Sector Engineer; UTD/Reg Dev. Div
Martin Humburg
Lead Education Economist
Albert Soer
Senior Conflict Prevention and Recovery Specialist;
Soc. inclusion
Grzegorz Gajda
Senior Sector Eng.; Housing

István Heinczinger
Senior Sector Economist; Reg. Transp. Progr. Division,
Mobility Dept
Mathieu Hallot
Sector Engineer; Energy Efficiency
Ignacio González
Procurement Specialist
Markus Pfeffer
Technical Advisory Services Specialist
Mathieu Haulon
Technical Advisory Services Specialist
Minos Mastrogeorgopoulos
Technical Advisory Services Specialist
Angela Filipas
Senior Environmental Specialist

Roy Draycott
Senior Sector Specialist; UTD/Reg Dev. Div.

We would also like to thank the BCG operational team which has continously liaised with the EIB representatives overthe full duration of the project:
BCG project team:
Mikolaj Boltuc
Project Leader

Adam Wronski
Consultant

Diana Ionescu
Consultant

Anton Zakharov
Consultant

Marek Kosco
Consultant

Veronika Zrubakova
Consultant

Cosmin Negoescu
Consultant

Iwona Kowalska
Art Director

Agata Siemek
Consultant
And thank the over 20 additional BCG topic experts which have been involved, and the over 30 external experts
contacted throughout the project on select topics:
Ukrainian central and municipal government
Military strategy
International relations
Ukrainian banking sector
Energy sector
Logistics
Digitalization

38

SUPPORTING UKRAINE: A STUDY ON POTENTIAL RECOVERY STRATEGIES FOR UKRAINEDuring the research BCG has used data and information from the following reputable sources:
Ukrainian government institutions including:
Velkovna Rada
National Bank of Ukraine
State Statistics Service of Ukraine
National Institute of Strategic Studies of Ukraine
Ukrainian State Road and Energy Agencies
Ukrainian organizations including:
Kyiv School of Economics
Gradus Research Company
Numerous national and local media
International institutions:International Organization for Migration
International Energy Agency
Centre of Eastern Studies Warsaw
European Business Association
Institute for the Study of War
The World Bank and other IFIs
International media

EUROPEAN INVESTMENT BANK|BOSTON CONSULTING GROUP

39

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