Today's Contents
Just The Facts:
- EBRD says it won't fund Ukrainian firms controlled by oligarchs - including DTEK
- Sambu, HD Hyundai Construction, other Korean stocks surge on optimism over Ukraine reconstruction
- Finnish LPs embrace defense investments amid Ukraine war: PitchBook
- Albania contributes to Council of Europe's action plan for Ukraine
Reporter's Notepad:
- Invitation to field questions for upcoming interviews
Here's What They Think:
- Project Syndicate: Trump may beat both China and Russia with lower price cap on Russian crude over Ukraine
- Daily Sabah: Ukraine conflict risks evolving into new Cold War
Sober Second Thought:
- Americans' views on US support for Ukraine have remained largely unchanged in recent months, though significant partisan differences persist, according to a Pew Research Center survey.
The Rebuilder's Social:
- American Chamber of Commerce in Ukraine announces the results of the elections for its legal committee
- Sayenko Kharenko announces its role as counsel to the IFC on the two risk- sharing facilities for Raiffeisen Bank Ukraine, totaling $210 million
Dear subscribers,
URN Daily invites subscribers to submit questions for upcoming interviews, when possible. So, please message editor Adam Brown at adam.brown@ukrainerebuildnews.com with any questions for two subjects to be interviewed in the next 48 hours:
- Jon Queen, CEO of Berezan port in Ukraine
- Nazar Bobotski, the Brussels-based representative of the Ukrainian agriculture sector to the EU.
EBRD says it won't fund Ukrainian firms controlled by oligarchs - including DTEK
The European Bank for Reconstruction and Development (EBRD) will not provide financing to Ukrainian companies controlled by oligarchs, including the country's largest private power producer, DTEK, the Italian daily Corriere della Sera reported on Sunday, citing EBRD President Odile Renaud-Basso.
"The goal of making Ukraine's economy free from the influence of oligarchs is fundamental," Renaud-Basso stated, as quoted by Corriere della Sera. "We are firmly committed to this, as it is one of the key reforms for Ukraine's accession to the EU. If we compromise on this issue, we will harm the country's long-term prospects."
Specifically, the EBRD does not intend to lend or guarantee loans to DTEK, even though over two-thirds of the company's electricity generation capacity from renewables and a third of its thermal capacity has been destroyed in Russian attacks, while Ukraine is bracing for a third war winter, as per the report.
The EBRD would first like to see DTEK owner, Ukraine's richest man Rinat Akhmetov, give up control over the group.
"There needs to be a change in the ownership structure as well as broader reforms. The war has weakened the influence of the oligarchs, but the situation may change after the war is over," Renaud-Basso noted.
Commenting on Renaud-Basso's remarks, DTEK told Interfax that Akhmetov was "categorically not an oligarch" under local regulations, adding it counts on cooperation with the EBRD.
The company noted it has invested $1.2 billion of its own funds to restore its energy infrastructure, which was the target of about 200 missile and drone attacks by Russia.
DTEK also recalled that the US and the European Commission decided to provide it with a combined €107 million in energy aid to rebuild capacity destroyed by the attacks. The company announced it was granted the aid on Monday.
Sambu, HD Hyundai Construction, other Korean stocks surge on optimism over Ukraine reconstruction
Companies poised to gain from the post-war reconstruction of Ukraine are seeing a surge in their stock amid expectations that US President-elect Donald Trump will bring the conflict to an end.
Amid optimism of an imminent end to the war, stocks in the construction, machinery, communication and agriculture sectors have been rising on the benchmark Korea Composite Stock Price Index (KOSPI) and secondary bourse Kosdaq, the Korea Times reported.
On Tuesday, Sambu Engineering stock closed at KRW 1,247 ($0.89) up about 130% from KRW 540 on Nov. 5, when Trump won the presidential election. HD Hyundai affiliate HD Hyundai Construction Equipment climbed 31% from 50,600 won to 66,200 won in the three weeks since Trump was elected.
In the communications sector, Kosdaq-listed Dasan Network has jumped 20%, from 3,265 won to 3,920 won, since the US presidential election and Daedong Industrial, an agricultural machinery manufacturer, surged 33% to 11,130 won as of Tuesday compared to 8,390 won on Nov 5.
Representatives from South Korean firms, often accompanied by high-level political delegations, have visited Ukraine repeatedly over the past two years in the hopes of scoring contracts in the reconstruction of Ukraine.
Sambu has been engaged in talks with Ukraine's presidential office since May to discuss projects, according to unnamed industry sources. The company has also signed an agreement with the regional council of Vinnytsia in central Ukraine to work on projects related to reconstruction and manufacturing.
Hanwha Solutions, Yooshin, Posco, Korea Land and Housing, Korea Water Resources, Samsung C&T, Hyundai Engineering & Construction, HD Hyundai, Naver, KT, CJ Korea Express and others have signed agreements committing to some level of involvement in the reconstruction.
Notable projects that have drawn South Korean interest include the development of a smart transportation master plan for Kyiv and area and a smart city plan for the city of Uman, rebuilding the exploded Kakhovka dam in the south and the sewage treatment infrastructure in the Kyiv suburb of Buch, and upgrading Kyiv’s Boryspil International Airport.
Also last year, state-run railway operator Korea Railroad Corp (Korail) and the Korea National Railway (KNR) signed an agreement to help Ukrainian state-owned rail operator Ukrainian Railways build an express railway to neighboring Poland.
The companies also agreed to help boost the capacity of rail connections between the southern Ukrainian cities of Odesa, Izmail and Reni, and build a railway traffic control center in Ukraine.
Finnish LPs embrace defense investments amid Ukraine war: PitchBook
The war in Ukraine has softened the approach of the Finish institutional investor base to the defense economy in a slow abandonment of the longstanding Finnish aversion to profiting from wartime materials, PitchBook reported.
"Defense investing is very taboo in Finland," Patrik Louko, chief investment officer of the €170 million ($177 million) endowment at the University of Jyväskylä, told PitchBook. "If you go back three years and you were a VC and you told your LP that you were investing in defense tech, they would have killed you."
Louko now aims to shape the endowment's portfolio after US mega-endowments like Yale University, emphasizing private equity and venture capital. Over the next year, the fund plans to deploy $70 million across these asset classes, focusing on diversifying beyond its current reliance on Finnish VC managers.
A key aspect of Louko's strategy is shielding the university's portfolio from the effects of conflict with Russia. This includes allocating to dual-use technology funds that support innovations applicable to both civilian and defense sectors, such as drones and satellite technology.
Additionally, Louko intends to bolster the endowment with investments in absolute return and private debt funds to mitigate downside risks.
Other investors are adopting a similar strategy. According to PitchBook data, VC investment in Nordic aerospace and defense companies has reached $94 million so far this year, marking a 71.1% increase from the 2023 total.
Albania contributes to Council of Europe's action plan for Ukraine
Albania has made a voluntary contribution of €30,000 to the Council of Europe's 2023-2026 action plan for Ukraine, the Council said in a press release on Monday.
The "Resilience, Recovery, and Reconstruction" action plan aims to help Ukraine align with European standards in human rights, democracy, and the rule of law amid the ongoing war with Russia. It also focuses on supporting Ukraine's recovery and reconstruction while addressing its urgent needs.
The overall budget for the four-year cooperation framework is estimated at €50 million. This is the largest-ever budget of a Council of Europe action plan for a country.
Project Syndicate: Trump may beat both China and Russia with lower price cap on Russian crude over Ukraine
US President-elect Donald Trump could force Russia to withdraw from Ukraine by imposing a significantly lower price cap on Russian crude, which, coupled with stricter sanctions enforcement against entities trading with Russia, would send a strong message to the leadership of Russia and China that any aggression against a neighbor will result in devastating economic repercussions, the 2024 Nobel laureate in economics, Simon Johnson, and former economic adviser to Ukrainian President Volodymyr Zelensky, Oleg Ustenko, wrote in an op-ed for the Project Syndicate.
Daily Sabah: Ukraine conflict risks evolving into new Cold War
Ukraine has not lost the front-line and buffer-zone characteristics it had during both World Wars, remaining a battleground between the US and Russia, with ceding occupied territories to Russia may potentially mark the start of a renewed Cold War, associate professor at the Turkish Yeditepe University's History Department, Furkan Kaya, wrote in an op-ed for the Daily Sabah.
Americans' views on Ukraine war stay divided along party lines, survey finds
Americans' views on US support for Ukraine have remained largely unchanged in recent months, though significant partisan differences persist, according to a Pew Research Center survey conducted between November 12 and 17.
Republicans are significantly more likely than Democrats to believe the US is providing too much support to Ukraine (42% vs. 13%). They are also far less likely to feel the US has a responsibility to help Ukraine defend against Russia's invasion (36% vs. 65%).
Additionally, Republicans and Republican-leaning independents have consistently been less likely than Democrats and Democratic-leaning individuals to view Russia's invasion as a major threat to US interests. However, this partisan gap has widened, with only 19% of Republicans now considering it a major threat, compared to 42% of Democrats, the survey found.
Over a quarter of Americans (27%) believe the US is providing too much assistance to Ukraine, while 25% say the support is "about right," and 18% feel the US is not providing enough. Among Republicans, 42% say the US is providing too much support, while among Democrats, 13% say the same.
Pew Research Center noted the survey was conducted before the Biden administration allowed Ukraine to use US-supplied long-range weapons to strike inside Russia and provided Ukraine with anti-personnel mines.
The survey saw participation from 9,609 US adults.
Ukrainian law firm Sayenko Kharenko says it served as Ukrainian legal counsel to the IFC on the two risk- sharing facilities for Raiffeisen Bank Ukraine, totaling $210 million, signed Nov 20.
USAID Economic Resilience Activity (ERA) announced a tender, via development firm DAI, for local vendors looking to sell floating security barriers, with a deadline of submission of proposals of Dec 19.
Ukrhydroenergo, the Ukrainian state hydropower producer, has agreed with Norwegian energy firm Statkraft to "implement joint programs to improve the skills of their employees, which will help to implement the world's best practices in hydropower."
The American Chamber of Commerce in Ukraine announced the results of results of the Annual Election of the AmCham Legal Committee, which now includes co-chairs Olena Biziaieva, legal director of ArcelorMittal Kryvyi Rih, Vitaliy Odzhykovskyy, partner at Sayenko Kharenko, and Denys Petrychenko, Legal Counsel of Ukraine and Moldova for Mondelēz International Ukraine.
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