COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS UKRAINE RELIEF AND RECONSTRUCTION
Date: 2022-05-18
Institutions: European Commission, Secretariat-General
Subjects: EU international partnership, Russia, Ukraine, economic reconstruction, economic recovery, financial aid, humanitarian aid, military intervention, urban renewal

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  EN 

   EUROPEAN COMMISSION  Brussels, 18.5.2022  COM(2022) 233 final  COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS  UKRAINE RELIEF AND RECONSTRUCTION              
 
 
I. 

INTRODUCTION 

The  unprovoked  and  unjustified  Russian  invasion  of  Ukraine  has  caused  terrible  human 
suffering and massive destruction of towns and communities. Lives and livelihoods are being 
lost, with more than twelve million people forced from their homes – and nearly six million 
from their country, half of them being children – in search of safety.  

Confronted  with  the  Russian  aggression,  the  European  Union  and  its  Member  States  have 
shown  unwavering  solidarity  with  people  fleeing  the  war  in  Ukraine1  and  immediately 
mobilised  support  to  the  Ukrainian  government  to  maintain  its  functions.  The  Union  has 
provided emergency assistance to support resilience, humanitarian assistance, military aid and 
other support. The Commission is coordinating its largest ever operation under the EU Civil 
Protection Mechanism for a wide array of support measures, including in the health, energy, 
food and agriculture sectors, and providing shelters, machinery as well as medical equipment 
and  evacuations.    To  support  Ukraine,  the  Commission  has  also  put  forward  measures  to 
facilitate trade, notably the suspension of import duties on Ukrainian exports, and to establish 
solidarity  lanes  to  help  Ukraine  export  agricultural  goods.  The  EU's  welcome  has  been 
exemplified by the activation of the Temporary Protection Directive, granting access to jobs, 
housing, education and healthcare across the EU. The Commission will continue to support 
Ukraine and its people, working together with Member States in a Team Europe approach.  

With hostilities taking place across the whole country, the economic situation has deteriorated 
rapidly. GDP is expected to fall by 30 to 50% this year and tax revenues dropped by around 50 
to  80%.  Ukrainian  Azov  and  Black  Sea  ports  remain  blocked  by  Russian  military  action, 
depriving  Ukraine  of  much-needed  export  revenues.  The  estimated  overall  damage  runs 
already  in  the  hundreds  of  billions  of  euros,  with  more  than  EUR 100  billion  in  damage  to 
physical infrastructure alone.  

A major global financial effort is required to support Ukraine during this war, as well as to 
rebuild the country and provide new opportunities to its citizens. This is why it is important to 
design the main building blocks of this international effort already now, even while Russia’s 
aggression  continues.  In  its  conclusions  of  March  2022,  the  European  Council  agreed  to 
develop a Ukraine Solidarity Fund, inviting international partners to participate. The European 
Council called on the Commission to continue developing technical assistance to help Ukraine 
to implement necessary reforms.  

A reconstruction of this scale on the European continent requires strong leadership from the 
European Union, working proactively with international partners. Ukraine is closely tied with 
the European Union through the Association Agreement and its Deep and Comprehensive Free 
Trade Area. On 28 February 2022, Ukraine applied for EU membership, and it has expressed 
a strong will to link reconstruction with reforms on its European path. 

This Communication sets out the Union’s response to address Ukraine’s immediate financing 
gap and the longer-term reconstruction framework. 

II. 

IMMEDIATE RELIEF 

1 For example, the Cohesion’s Action for Refugees in Europe provides Member States with immediate liquidity 
and additional flexibility in the use of EU funds to welcome people fleeing Ukraine.  

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The  short-term  response  covers  the  immediate  period  when  reconstruction  efforts  on  a 
significant  scale  cannot  yet  be  envisaged.  Assistance  in  this  period  is  mainly  focused  on 
necessary  operational  support  to  the  Ukrainian  government,  complemented  by  providing 
emergency assistance and humanitarian aid. 

Support already provided 

The EU’s commitment to supporting Ukraine is long-standing and has delivered results. The 
EU has provided significant financial assistance to Ukraine, which over the years from 2014 to 
2021 amounted to EUR 1.7 billion in grants under the European Neighbourhood Instrument, 
EUR 5.6  billion  under  five  macro-financial  assistance  programmes  in  the  form  of  loans, 
EUR 194 million in humanitarian aid and EUR 355 million from foreign policy instruments. 
The EU provides its support to Ukraine for policy development and comprehensive reforms, 
with strong involvement from Member States in a Team Europe approach. Among the flagship 
programmes are those on decentralisation, public administration reform and anti-corruption. 

Since the Russian aggression  started, the EU has stepped up its support, mobilising  around 
EUR 4.1 billion for Ukraine’s overall economic, social and financial resilience in the form of 
macro-financial  assistance,  budget  support,  emergency  assistance,  crisis  response  and 
humanitarian aid. Military assistance measures under the European Peace Facility, amounting 
to EUR 1.5 billion, have also been provided to Ukraine and the mobilisation of an additional 
EUR 500 million is under way.  

Before and during the war, the EU has worked closely with European financial institutions to 
support  Ukraine.  Since  2014,  the  European  Investment  Bank  and  the  European  Bank  for 
Reconstruction and Development have mobilised over EUR 10 billion in loans to Ukraine. In 
recent weeks, the European Investment Bank has disbursed EUR 668 million to the Ukrainian 
budget. The EU is also working in close cooperation with the World Bank and the International 
Monetary Fund, which have been key partners in the Ukrainian efforts since 2014.  

Short-term relief  

The war resulted in a collapse of tax, export and other revenues, compounded by large scale 
illegal  appropriation  of  assets  and  export  goods  including  in  the  agricultural  sector,  while 
essential expenditure skyrocketed. Ukraine will need significant short-term financial relief to 
sustain basic services, to address humanitarian needs and to fix the most essential infrastructure 
that is now destroyed. The International Monetary Fund has estimated Ukraine’s financing gap 
until June at roughly EUR 14.3 billion (USD 15 billion)2.  

The Ukrainian government’s financing needs continue to be substantial in the short term, to 
sustain the country, help maintain macro-financial stability and reduce the stress on human and 
physical capital. Addressing these needs will require a joint international effort, in which the 
Union will be ready to play its part.  

For its part, the Commission therefore envisages to propose granting Ukraine new exceptional 
macro-financial  assistance  in  2022  in  the  form  of  loans  of  up  to  EUR  9  billion,  to  be 
complemented by support from other bilateral and multilateral international partners, including 

2 There is a high degree of uncertainty surrounding any financing gap, but the International Monetary Fund has 
worked closely with the Ukrainian authorities to establish a robust estimate of their needs, e.g., referred to by the 
International Monetary Fund’s Managing Director Kristalina Georgieva at the Spring Meetings on 21 April 2022. 

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in G7 format. This would be paid in tranches with long maturities and concessional interest 
rates thanks to the guarantee from the Union budget.  

To  make  this  possible,  Member  States  should  agree  on  making  available  guarantees  to 
complement  the  provisioning  set  aside  for  this  purpose  in  the  relevant  compartment  of  the 
Common Provisioning Fund of the Union. Together with grant support from the EU budget for 
subsidising  the  related  interest  payments,  this  will  ensure  well-coordinated  and  highly 
concessionary relief for Ukraine.  

III.  RECONSTRUCTION OF UKRAINE 

The  overall  reconstruction  of  Ukraine  will  require  comprehensive  support  to  rebuild  the 
country  after  the  war  damage,  to  create  the  foundations  of  a  free  and  prosperous  country, 
anchored in European values, well integrated into the European and global economy, and to 
support it on its European path.  

The reconstruction effort will need to  build on Ukraine’s  ownership, close cooperation  and 
coordination with supporting countries and organisations, and Ukraine’s strategic partnership 
with  the  Union.  Reconstruction  will  also  require  mobilising  resources  at  regional  and  local 
level. Peer-to-peer cooperation and programmes embedded in partnerships between cities and 
regions in the European Union and those in Ukraine will enrich and accelerate reconstruction. 

Four major pillars of reconstruction can already be envisaged:  

  Rebuilding  the  country,  in  particular  infrastructure,  health  services,  housing  and 
schools, as well as digital and energy resilience in line with the most recent European 
policies and standards;  

  Continue  modernising  the  state  and  its  institutions  to  ensure  good  governance  and 
respect for the rule of law, by providing administrative capacity support and technical 
assistance, including at regional and local level;  
Implementing  a  structural  and  regulatory  agenda  with  the  aim  of  deepening  the 
economic and societal integration of Ukraine and its people with the EU in line with its 
European path;  

 

  Support the recovery of Ukraine’s economy and society by promoting sustainable and 
inclusive economic competitiveness, sustainable trade, and private sector development, 
while contributing to the green and digital transition of the country.  

Establishing  a  clear  link  with  the  broad  reform  agenda  will  be  vital  for  the  success  of  the 
reconstruction effort. Ukraine has made significant reform progress over the years. It will be 
important to consolidate and accelerate these reforms once the full reconstruction effort starts. 
The  reconstruction  should  be  in  line  with  the  European  green  and  digital  agenda;  it  should 
strengthen resilience and respect fundamental principles of the rule of law, including on anti-
corruption, judiciary, public administration and good governance.  

Given the extent of the war damage so far, the financial needs for reconstruction are expected 
to be substantial and the reconstruction effort would potentially span more than a decade. The 
Commission  will  work  in  close  cooperation  with  Ukraine,  international  partners  and 
international financial institutions to assess the reconstruction needs, looking at how best to 
meet them.  

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A Ukraine-led reconstruction effort embedded in its European path 

The  reconstruction  effort  should  be  framed  in  a  high-level  strategic  reconstruction  plan 
(ʻRebuildUkraineʼ),  for  which  Ukrainian  authorities  have  full  ownership3  and  which  is 
endorsed by the Union and other international partners. The ‘RebuildUkraine’ reconstruction 
plan  would  outline  key  reforms  and  investments  necessary  to  build  a  prosperous  and 
sustainable future for Ukraine. 

The Ukrainian Government has clearly expressed its intention to embed the ‘RebuildUkraine’ 
reconstruction plan in a strategic partnership with the European Union. This reflects the close 
political  and  economic  relations  based  on  the  Association  Agreement  with  its  Deep  and 
Comprehensive  Free  Trade  Area  and  Ukraine's  recent  application  for  EU  membership. 
Establishing  a  clear  link  to  the  broad  reform  agenda  will  be  vital  for  the  success  of  the 
reconstruction process, and the alignment with the EU acquis.  

The Ukraine reconstruction platform  

The reconstruction effort should be led by the Ukrainian authorities in close partnership with 
the  European  Union  and  other  key  partners,  such  as  G7  and  G20  partners  and  other  third 
countries, as well as international financial institutions and international organisations.  

3 The Ukrainian government has set up a National Council for Recovery, which has been tasked with preparing a 
plan  for  the  post-war  recovery  and  development  of  Ukraine.  The  establishment  of  the  plan  will  build  on 
remarkable  cooperation  and  institutional  capacity  demonstrated  by  the  Ukrainian  authorities  at  all  levels, 
municipalities  as  well  as  civil  society  (Regulation  on  the  National  Council  for  Recovery  of  Ukraine  from 
Consequences of War, approved by Decree of the President of Ukraine dated 21 April 2022, № 266/2022). On 
the EU side, the European Commission established in 2014 a dedicated Support Group for Ukraine to support 
reforms in the country.  

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The ‘Ukraine reconstruction platform’, an international coordination platform, co-led by the 
Commission,  representing  the  European  Union  and  the  Ukrainian  government  would  be 
established.  The  platform  would  bring  together  the  supporting  partners  and  organisations, 
including  EU  Member  States,  other  bilateral  and  multilateral  partners,  and  international 
financial institutions. The Ukrainian Parliament and the European Parliament would participate 
as observers. In this way, it would act as an overarching and single-entry point for all actions 
on the reconstruction of Ukraine.  

Whereas ownership of this reconstruction plan should rest with Ukraine, the platform should 
be  the  strategic  governance  body  endorsing  the  high-level  strategic  ‘RebuildUkraine’ 
reconstruction plan and ensuring that the support provided is in line with the plan. Based on 
that plan, the platform would determine the priority areas selected for financing and the specific 
projects implementing those priorities, coordinate the financing sources and their destination 
to optimise their use, including budgetary support to the Ukrainian state, investment support, 
guarantees for private sector investments, focus on specific sectors and monitor progress in the 
implementation  of  the  plan.  Administrative  capacity  support  and  provision  of  technical 
assistance  would need to be provided to  Ukraine  to  effectively draw up  and implement  the 
‘RebuildUkraine’ reconstruction plan.  

The platform should bring together under one roof the EU support as well as other initiatives 
set up by other partners such as the World Bank Trust Fund or the International Monetary Fund 
administered account ensuring a smooth division of labour between different partners, avoiding 
duplication and promoting synergies, including through joint co-financing of specific projects.  

The Unionʼs support  

The  Union  is  ready  to  provide  a  major  part  of  the  overall  efforts  from  the  international 
community in the rebuilding of Ukraine. A joint EU approach to the Ukraine reconstruction 
would be in the interest of Member States and Ukraine, helping to create the conditions for a 
free,  democratic,  prosperous  and  sustainable  Ukraine  as  part  of  the  European  family.  EU 
financial mechanisms moreover provide the best safeguards for the proper use of funds.  

The framework for the EU’s contribution to the reconstruction of Ukraine would consist of the 
following strands: 

  The ‘RebuildUkraine’ Facility, a new EU-funded instrument specifically dedicated to 
finance the reconstruction effort and the alignment of Ukraine’s economy to the EU; 
  Support from existing Union programmes, including blending and guarantees under the 

Neighbourhood, Development and International Cooperation Instrument. 

Reconstruction  and  resilience  support  –  including  humanitarian  aid,  which  will  need  to  be 
reinforced and implemented in  line with  humanitarian principles, – will have to  go hand in 
hand for a number of years, to take care of the most vulnerable parts of the population, such as 
internally  displaced  persons,  children,  victims  of  war  including  victims  of  sexual  violence, 
minorities,  persons  with  disabilities,  people  in  need  of  protection  and  those  who  cannot  be 
reached by public social services. 

‘RebuildUkraine’ Facility at the heart of Unionʼs support 

The ‘RebuildUkraine’ Facility would be the main legal instrument for the European Union’s 
support,  through  a  mix  of  grants  and  loans,  to  the  ‘RebuildUkraine’  reconstruction  plan.  It 

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would be embedded in the EU budget, thereby ensuring the transparency, accountability and 
sound financial management of this initiative. The Facility would follow Ukraine’s EU-driven 
reform agenda and its implementation should therefore be carried out with a view to helping 
Ukraine rebuild its economy, with a clear link to investments and reforms. It would build on 
the  experience  with  financing  investments  and  reforms  under  the  Recovery  and  Resilience 
Facility inside the EU, adapted to the unprecedented challenges of reconstructing Ukraine and 
accompanying it on its European path.  

The  Facility  itself  would  have  a  specific  governance  structure  ensuring  full  ownership  by 
Ukraine. It would ensure that investments – including in strategic digital, transport and energy 
infrastructure – are brought in line with climate and environmental EU policies and standards. 
Its  reforms  would  help  to  further  integrate  the  Ukrainian  economy  into  the  single  market 
improve the business environment to attract necessary foreign direct investments, support the 
creation of jobs and facilitate the gradual alignment and compliance with EU law. It would put 
significant emphasis on good governance, the rule of law, sound financial management as well 
as anti-corruption and anti-fraud proofing.  

Mobilising resources for the Unionʼs support 

With the war ongoing, the overall needs for the reconstruction of Ukraine are not yet known. 
They will extend beyond rebuilding of physical assets, including infrastructure, and will need 
to comprise budgetary support to the Ukrainian state. The duration of such support cannot now 
be estimated in precise terms; however, it will have to have a medium- to long-term horizon.  

Even if combined with contributions from other international partners, the European Union has 
a strategic interest in leading the reconstruction effort of Ukraine. This implies a major share 
in  the  total  international  financial  effort.  At  the  same  time,  the  large-scale  and  the 
comprehensive  nature  of  the  reconstruction  of  a  country  damaged  by  war,  combined  with 
support to its European path, imply important outlays at the beginning and predictability of 
such support over time.  

These unforeseen needs created by war in Europe are well beyond the means available in the 
current  multiannual  financial  framework.  Therefore,  new  financing  sources  will  have  to  be 
identified.  

The architecture described above is sufficiently flexible to accommodate such new financing 
sources.  The  additional  grants  to  be  made  available  to  Ukraine  could  be  financed  either  by 
additional contributions from Member States (and by third countries should they wish to do so) 
to  the  Facility  and  existing  Union  programmes,  thus  benefitting  from  the  Union’s  financial 
mechanisms and safeguards for the proper use of funds, or through a targeted revision of the 
multiannual financial framework. These sources could also finance the loans to be granted to 
Ukraine under the Facility. However, given the scale of the loans that are likely to be required, 
options include raising the funds for the loans on behalf of the EU or with Member States’ 
national guarantees.  

In  this  context,  it  can  be  considered  whether  it  is  possible  to  use  frozen  Russian  assets  as 
financing source in line with national and EU law, for instance following potential criminal 
proceedings on criminal activities related to EU-listed Russian or Belarusian individuals and 
companies. 

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IV.  CONCLUSION 

While international efforts to provide short-term relief and to bring the Russian aggression to 
an end continue, it is also time to look ahead and prepare for the massive reconstruction effort 
that will follow. This effort must be led by Ukraine, with strong and sustained support from the 
European Union and international partners. 

This communication outlines a comprehensive framework for these efforts, fully reflecting the 
needs  identified  by  Ukraine  and  firmly  anchored  in  the  green  and  digital  transitions  and 
fundamental  European values. These investments  will help  Ukraine to  emerge stronger and 
more resilient from the devastation of the Russian invasion. In time, they will support Ukraine 
in pursuing its European path. 

The Commission invites the European Parliament, the European Council, and the Council to 
endorse the ideas put forward in this communication. Through ‘Rebuild Ukraine’, the European 
Union  will  send  another  clear  signal  of  its  unwavering  commitment  to  stand  with  Ukraine 
through the war and its aftermath, and to help rebuild a stronger Ukraine for the next generation. 

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