June 23. 2024. 12:22

The Daily

Read the World Today

World Bank chief says Europe needs to help fund Ukraine reconstruction

The World Bank is ready to do its part in rebuilding Ukraine after the devastation of Russia’s invasion, but international financial institutions cannot shoulder the sums involved alone and Western European countries will have to chip in, World Bank President David Malpass said on Tuesday (11 April).

Malpass, speaking at the spring meetings of the International Monetary Fund and World Bank, noted that the World Bank had played a big role in rebuilding Europe’s steel industry after World War Two and could play a similar role in Ukraine.

“But the size is daunting,” he said, citing a recent estimate that it would cost $411 billion to rebuild Ukraine’s economy, or 2.6 times its expected 2022 gross domestic product. The number, calculated by the World Bank, United Nations, European Commission and Ukraine, was up sharply from an estimate of $349 billion released last September.

The World Bank’s total commitments in 2022 totaled $75 billion, a 50% increase from the average.

The European Union had large funding sums that could be brought to bear, Malpass said.

“The bank is prepared to play its role in the reconstruction, but I do need to set the expectations for the world that the amount to rebuild the electricity sector, the road sector, a railroad sector are way bigger relative to the size of the balance sheets of the international financial institutions,” he said.

Ukrainian President Volodymyr Zelenskyy will call for continued support for the war-torn country in a virtual speech on Wednesday to top finance officials, joined by Prime Minister Denys Shmyhal and Finance Minister Serhiy Marchenko, who are attending the meetings in person.

US Treasury Secretary Janet Yellen on Tuesday repeated Washington’s commitment to support Ukraine for as long as needed. She said support from the United States and the European Union would take Ukraine through the end of the year, but if the war continued, Washington would have to work with partners to provide the support needed.

She noted that a multi-donor platform has been set up to coordinate a longer-term plan for reconstruction. Washington has also allocated some money for immediate short-term reconstruction needs, including rebuilding its electricity grid.