In a significant move to aid Ukraine’s recovery and reconstruction efforts following Russia’s invasion, the United Kingdom and the European Bank for Reconstruction and Development (EBRD) have signed a Statement of Intent to establish a war-risk insurance scheme.
This scheme aims to empower UK companies to engage in business activities within Ukraine and contribute to its restoration.
The lack of available insurance coverage had been a substantial hindrance preventing UK companies from trading with and investing in Ukraine. With the country’s recovery estimated to cost a staggering $411 billion by the World Bank, private sector involvement is crucial.
Industries such as architecture, engineering, and construction are essential in rebuilding critical infrastructure like bridges. However, these companies have faced challenges obtaining the necessary insurance to operate in a region marked by conflict.
The UK government is taking a lead role in addressing this issue by improving access to war-risk insurance. This initiative is a follow-up to the Ukraine Recovery Conference, which was hosted by the UK Prime Minister earlier this year and resulted in the London Conference Framework aimed at addressing the insurance gap.
Business and Trade Minister, The Earl of Minto, emphasised the importance of overcoming insurance-related barriers, stating, “UK businesses have the expertise and desire to help Ukraine rebuild. But too often a lack of insurance prevents our world-class architects, engineers or lawyers, from doing that, and hinders Ukraine’s recovery.”
“That’s where Government comes in – we are committed to breaking down the barriers that get in the way of UK companies offering their expertise. Today’s signing is another step forward in our ongoing support for Ukraine on this issue.”
The EBRD’s scheme development will provide essential support for increasing the availability of insurance against war-related risks in Ukraine.
It is initially focused on ensuring the transport of crucial cargo via trucks, which is vital for keeping trade flowing. The plan is to expand coverage to more sectors as the scheme matures.
Business and Trade Minister, The Earl of Minto, signed the Statement of Intent alongside EBRD President Odile Renaud-Basso. They also discussed further steps to broaden the availability of war-risk insurance.
EBRD President Odile Renaud-Basso expressed gratitude for the UK’s involvement in facilitating insurance against war-related risks in Ukraine.
She emphasised the importance of building a sustainable solution that will not only aid the domestic economy but also protect trade activities.
The UK’s non-military support for Ukraine since the beginning of the invasion has amounted to £4.7 billion, which includes fiscal support and bilateral assistance.
This signing precedes the Rebuild Ukraine Conference and the UK-Ukraine Infrastructure Taskforce meeting in Warsaw, led by Minister for Industry Nusrat Ghani. These events are expected to provide a platform for the UK and Ukraine to discuss and prioritise reconstruction projects.
Minister for Industry and Economic Security, Nusrat Ghani, commented, “The UK is a key partner for Ukraine and we remain committed to providing the crucial support it needs as it continues to rebuild its infrastructure and economy.”
