Ukraine is facing one of the most difficult challenges of its modern history, the reconstruction of energy infrastructure destroyed by war. This process requires not only financial support, but also cooperation between states, international organisations and the private sector. Slovakia, as a neighbour of Ukraine and a member of the European Union, has an important role to play in this process. As a country, we have succeeded in the international competition of the European Commission’s call under the ‘Ukraine Investment Framework’ (UIF) and have been awarded more than EUR 100 million to support the reconstruction of Ukraine’s energy infrastructure.
The approval of the investment project by the Slovak Ministry of Diplomacy through its subordinate organization Slovak Agency for International Development Cooperation (SAMRS) and Eximbanka is thus a historic success for Slovakia. In this context, Eximbanka will provide financing of EUR 77.2 million, guaranteed by a 90% guarantee from the European Commission. A further €23.3 million is managed by SAMRS, with these funds earmarked for technical assistance and investment grants to Ukrainian energy companies. The aim of the programme is to modernise and renew energy facilities in Ukraine, improve energy transmission and support the integration of the Ukrainian grid into European energy markets. These projects mainly concern the reconstruction of substations and transmission systems, but also ambitious plans for the construction of combined solar and wind power plants.
As a country, we can make use of our expertise in energy infrastructure and, by investing in new lines, we can also support the interconnection of the Ukrainian energy network with the European one. This is a challenge that can offer Slovak companies not only access to an interesting market, but also the opportunity to actively participate in the unique and technologically demanding transformation of the Ukrainian energy sector. To this end, long-term loans from Eximbanka, which are guaranteed up to 90% by the European Commission, as well as investment grants administered by SAMRS to cover part of the upgrade costs, will be available.
Ukrainian energy companies such as Ukrenergo and Ukrhydroenergo, which are involved in the renewal of the energy infrastructure, can benefit from these loans, which are also backed by non-repayable investment funds from European Commission grants. This financing system helps to reduce project implementation costs and ensures that the investments are efficient and sustainable in the long term. Slovak entrepreneurs operating in the energy, technology and infrastructure sectors can participate in the UIF scheme through competitive tenders. If they are successful, they will become contractors for Ukrenergo and Ukrhydroenergo projects and will receive financing in combination with European Commission grant funds, which are provided together with Eximbanka´s loans.
In addition to the above-mentioned UIF programme, Slovak companies can also get involved in other existing projects in Ukraine by directly investing or becoming suppliers for projects in Ukraine, or by forming special project companies with Ukrainian partners. There is also the possibility to create a branch or subsidiary in Ukraine, a joint venture or to create a partnership between Slovak and Ukrainian companies in the field of supply and implementation of projects or cooperation with Ukrainian state-owned enterprises. In the near future, Eximbanka will introduce a database of tenders to facilitate Slovak exporters’ orientation and possible participation in tenders not only in Ukraine.
Despite the great potential offered by projects abroad, Slovak exporters should not forget the challenges associated with them. For example, the Ukrainian market still faces political, economic and military risks that may affect the stability of long-term investments. It is therefore crucial that companies carefully assess the risks associated with any project anywhere in the world and ensure adequate protection through instruments such as insurance and guarantees. At the same time, the involvement of Slovak exporters in projects in foreign markets represents a significant opportunity for their growth and expansion in the region, either by gaining new business contacts or by strengthening their competitiveness.