**U.S.-Backed Fund to Boost Investment in Ukraine, Benefits Other Countries Too**
The U.S. International Development Finance Corporation (DFC) and Ukraine’s Support Public-Private Partnership Agency (PPP Agency) have created a reconstruction investment fund that will not only benefit U.S. companies but also other countries, according to officials from the DFC. The announcement was made during a workshop at the Ukraine Recovery Conference in Rome on July 11.
The “minerals deal” aims to attract investment in Ukraine’s natural resources, such as critical raw materials, and infrastructure like ports and transport. While it was developed by American and Ukrainian agencies, it can be beneficial for non-American companies and investors as well.
“We’re not trying to crowd out other capital,” said Jonathan Taylor, deputy associate general counsel for direct equity and investment funds at the DFC, during the workshop. “We’re here to invest in Ukraine.” He added that there will be co-investment opportunities for European nations and other countries.
**Ukraine to Share Profits with U.S. Fund**
Under the agreement, Ukraine will transfer 50% of its profits from new licenses, new royalty payments, and new production sharing agreements to the fund over 10 years. New U.S. military aid will be included as part of Washington’s contribution. However, this doesn’t give the U.S. any special terms; it will still operate on commercial terms, said Taylor.
“The right of first refusal will be clearly articulated in all new licenses granted,” said Denys Alyoshyn, director of strategy at UkrLithiumMining, a Ukrainian lithium company, after the workshop. “This doesn’t give any preferential treatment to the U.S. side.”
**Addressing Investor Concerns**
The DFC will also mobilize private capital with more extensive use of political risk insurance, which should ease concerns of hesitant foreign investors. According to panelist Giovani Salvetti, the head of Rothschild & Co. for the CIS Region, 70% of the issues investors have with investing in Ukraine can be solved by the fund.
For now, the structure and mechanism of the fund are still being developed, and the first board meeting is planned to take place within a month. The fund is still collecting seed investment, with $25 million expected by September, and it should start operating by the end of the year with initial investments in pilot projects.
**Ukraine’s Economy Minister Confirms Pilot Project**
Ukraine has presented at least eight projects for investment with the pilot project already underway, the Dobra lithium mine in central Ukraine. Ukraine’s Economy Minister Yulia Svyrydenko confirmed that the U.S. government-backed company TechMet is likely to bid on the mine, having eyed up the deposit since 2023.
Read More @ kyivindependent.com
