Today's Contents
Reporter's Notepad:
- To help rebuild, a US-led engineering firm in Ukraine must first survive the USAID freeze
Just The Facts:
- US, Russia to meet in Saudi Arabia in coming days to launch talks on ending Ukraine war, sources say
- Trump says Zelensky will be involved in upcoming Ukraine peace talks
- Ukraine refuses to sign off on draft minerals deal with US
- Ukraine pitches $500 million in investment opportunities in Saudi Arabia; finds notable interest in fertilizer production
- Ukraine state company Ukroboronprom to form JV with French defense giant Thales
- Ukraine gets equity funding offers for Khmelnytskyi NPP from several investors, energy minister says
- EBRD signs a second $100 million revolving credit facility in hryvnia with Citi Ukraine
Here's What They Think:
- Washington Post: In a Russia-Ukraine peace deal, one issue is beyond questioning
- The Hill: Getting a Ukraine settlement right requires pressure on Putin
Sober Second Thought:
- Americans remain split on US aid to Ukraine along party lines, survey finds
A word from Adam Brown, the editor:
Dear reader,
URN Daily is preparing a series of articles that convey the wisdom of old hands to the Ukraine investment scene. The aim is to help newcomers to the reconstruction as well as companies considering coming in.
So, I called up Dan Aspleaf, an American I've met before. He has been living in Ukraine for 15 years, including 11 years as CEO of CDM Engineering. He offered plenty of frank advice for the newcomer, from dealing with the country's idiosyncratic bureaucratic style to setting realistic expectations for construction projects.
But that's for another day.
I had started the conversation by asking him if he's busy. At URN Daily, we've been run ragged in the last couple of weeks as the world suddenly seems to be looking more seriously at the reconstruction of Ukraine - contact requests, story ideas, offers and other communications, on top of the accelerated pace of the news.
I had expected Dan would tell me stories of how he, too, was barely keeping up with contract offers and requests for assistance. That's not what I heard though. I suppose I shouldn't have been surprised.
Here's the news story covering the recent weeks in Dan's life:
To help rebuild, a US-led engineering firm in Ukraine must first survive the USAID freeze
As the experienced CEO of a well-regarded engineering firm in Ukraine, Dan Aspleaf could expect to be extremely busy. After all, the Western world is preparing a Ukrainian reconstruction project that they say dwarfs even the post-WWII Marshall Plan.
Instead, Aspleaf's company finds itself suddenly short of work. And, even in an environment with a severe lack of qualified labor and an abundance of work that needs doing, he may be forced into downsizing.
"We're having a difficult time - there's a giant hole in my cash flow," said Aspleaf, an American who has served in Kyiv as CEO of CDM Engineering for 11 years, including the past three years of full-scale war. "The stoppage of USAID work took away half of our revenue."
The USAID work frozen last month included projects to upgrade Ukrainian border crossing posts, bolster the security of Ukraine's energy generation facilities and restore the nation's infrastructure. CDM, as one of the few firms in the country that can meet the exacting standards required, worked on all three.
"Worse yet, the way they've done it, is they put a freeze on back payments, so we haven't been paid for our work since last November," he told the Ukraine Rebuild Newswire in an interview. "Even the giant global firms would have trouble surviving three months of non-payment."
In most of the cases, CDM was a subcontractor – the first-level contractors are suffering too.
On the energy security contract, CDM was subcontracting for global engineering giant Tetra Tech, which last year won a five-year, $439 million, single-award contract through the USAID Securing Power, Advancing Resilience & Connectivity Activity to improve energy security and resilience in Ukraine. Tetra Tech has already furloughed dozens of people back in the US.
The border crossing post contract came through Bethesda Maryland-based DAI Global. The contractor administers a $115 million USAID program to improve Ukrainian border crossing to help exporters cope with the impeded access to Black Sea shipping and other traditional routes. DAI Global last week announced it was furloughing 400 workers in the US.
Aspleaf's third contract, meant to help restore the nation's infrastructure, came from USAID via Dallas-based AECOM, which has won multiple contracts for works in Ukraine, including for restoring the country's damaged hydropower infrastructure and helping supervise multiple other projects.
The damage from the freezing of the USAID contracts compounds the challenge of working in a country in the midst of a full-scale war that has diverted much of the labor to the frontlines and wreaked havoc on the energy grid and infrastructure.
And the blows are concentrated on the highest-quality firms, the ones deemed most capable of carrying out massive nationwide projects.
The effect of the USAID stoppage also illustrates how dependent the reconstruction works still are on international finance institutions, foreign governments, and other international bodies, particularly as the Ukrainian government devotes as much of its own resources as it can to the war effort.
Since the full-scale invasion of February 2022, USAID has given Ukraine $2.6 billion in humanitarian aid, $5 billion in development aid, and facilitated $30 billion in direct support for the budget.
One of Aspleaf's two remaining contracts - on works to help municipalities weather the energy crisis sparked by Russian attacks on Ukraine's grid - is paid for by the Swiss Agency for Development and Cooperation, run by the Swiss government, which has earmarked CHF1.5 billion ($1.65 billion) for Ukraine aid over the next three years.
The funds for the other contract, which involves verifying the technical capabilities of small and medium businesses applying for low-cost loans, are paid for by the European Bank for Reconstruction and Development, which deployed a total of €2.4 billion in Ukraine last year.
He doesn't anticipate a rush of incoming work from private sector investors until the shooting stops in Ukraine, but Aspleaf said he's "cautiously optimistic" that USAID will resume the contracts and his firm will survive the crunch.
"The problem is, when you're owed money and you don't know when you're going to get it, you effectively have to assume, from a planning perspective, that you're not going to get it," he said.
And in the worst-case scenario?
"I like to think that my firm is pretty successful here in Ukraine, but there's no firm on earth that plans for the current non-payment policy from government contracts."
As always, with any tips, suggestions, complaints or requests, please email editor Adam Brown at adam.brown@ukrainerebuildnews.com
We're also especially interested if you would like to be interviewed for our series on advice for newcomers. Besides people involved in construction, we are interviewing people in banking, legal services, government relations, diplomacy and other areas.
Later this week, for example, we're interviewing the public relations head of a foreign company that has proven surprisingly effective at PR surrounding its Ukraine operations.
Or perhaps you are a newcomer to the Ukraine reconstruction scene - your early experiences could be extremely useful to other newcomers.
Thank you,
Adam Brown
And now, on to the headlines ...
US, Russia to meet in Saudi Arabia in coming days to launch talks on ending Ukraine war, sources say
US and Russian officials are set to meet in the coming days in Saudi Arabia to start negotiations aimed at ending the war in Ukraine, multiple media outlets reported on Saturday, citing unnamed sources familiar with the matter.
Members of the US delegations will include Secretary of State Marco Rubio, national security adviser Mike Waltz, and White House Middle East envoy Steve Witkoff, Politico, Reuters, and CBS reported, among others.
Speaking to reporters on the sidelines of the Munich Security Conference on Saturday, Ukraine's President Volodymyr Zelensky said that Kyiv has not been invited to take part in the talks in Saudi Arabia, as seen in a video posted by Radio Free Europe.
"We don’t have any papers, any invitations, and it's something strange for me to speak in this case, in this format, if before we don't have any negotiations between us and our strategic partners. As I remember, Russia is not our strategic partner," Zelensky stated.
Also on Saturday in Munich, the White House special envoy for Ukraine and Russia, Keith Kellogg said that European countries will not have a seat at the table for the negotiations on the peace in Ukraine, Reuters reported.
"I'm (from) a school of realism. I think that's not gonna happen," Kellogg said when asked about whether Europe will be involved in the talks, noting the US will act as an intermediary in the negotiations between Ukraine and Russia.
Meanwhile, US Secretary of State Marco Rubio and Russian Foreign Minister Sergey Lavrov had a phone conversation on Saturday, as a follow-up to US President Donald Trump's conversation with Russian President Vladimir Putin earlier, the State Department and Russia's Foreign Ministry said. Rubio and Lavrov also discussed other bilateral issues, as per the statements.
Trump says Zelensky will be involved in upcoming Ukraine peace talks
US President Donald Trump said on Sunday that President Volodymyr Zelensky will be involved in the upcoming negotiations to end the war in Ukraine.
Talks between US and Russian officials are set to begin on Tuesday in Saudi Arabia's capital of Riyadh, Reuters reported. US Secretary of State Marco Rubio, who arrived in the Middle Eastern country on Monday, is expected to be joined by Trump's national security adviser, Mike Waltz, and White House Middle East envoy Steve Witkoff.
"We are moving along, we're trying to get peace with Russia and Ukraine, and we are working very hard on it. It's a war that should have never started," Trump told reporters in Florida. Asked whether Zelensky will be involved in the talks, Trump said: "Yes, he will be involved."
When news about the negotiations between the US and Russia in Saudi Arabia was first reported on Saturday, Zelensky said Kyiv was not invited to take part in the talks.
Zelensky on Sunday arrived in the United Arab Emirates, Reuters reported. He mentioned plans to visit Saudi Arabia and Turkey and clarified that he does not intend to meet with Russian or US officials and that Ukraine is not believed to be invited to the talks hosted in Saudi Arabia.
In an interview with NBC published on Sunday, Zelensky stated he will "never accept any decisions between the United States and Russia about Ukraine."
Ukraine refuses to sign off on draft minerals deal with US
Ukraine's President Volodymyr Zelensky said on Saturday he directed his ministers not to sign off on a proposed rare earth minerals agreement with the US, saying the deal wasn't in Ukraine's best interest.
"I didn't let the ministers sign a relevant agreement because in my view it is not ready to protect us, our interest. For me is very important the connection between some kind of security guarantees and some kind of investment," Zelensky told The Associated Press on the sidelines of the Munich Security Conference in Germany.
The deal, which was at the center of discussions between Zelensky and US Vice President JD Vance at a meeting in Munich on Friday, was first presented to Zelensky on Wednesday during a visit to Kyiv by US Treasury Secretary Scott Bessent.
The details of the proposed economic partnership agreement, which is tied to US President Donald Trump's earlier proposal that Ukraine give the US access to its rare earth minerals in exchange for military aid, have not been publicly revealed.
Unnamed US officials familiar with the matter told NBC that the Trump administration proposed in the document that the US receive 50% ownership of Ukraine's rare earth minerals and indicated a willingness to deploy American troops to protect these resources if a peace agreement with Russia is reached.
In a recent interview with Fox News, Trump said he aimed the US to get $500 billion worth of Ukraine's rare earth minerals. Bessent has said that the blueprint of the deal anticipates that the US has the right to revenue Ukraine is already receiving from some resources.
Following the meeting with JD Vance on Friday, Zelensky said the two sides will continue to work on drafting the document on economic partnership. "We want peace very much, but we need real security guarantees. And we will continue our meetings and our work," Zelensky stated.
Ukraine pitches $500 million in investment opportunities in Saudi Arabia; finds notable interest in fertilizer production
A Ukrainian government delegation led by Economy Minister Yulia Svyrydenko began a visit to Saudi Arabia by presenting business opportunities with a total investment potential of $500 million to nearly a hundred local entrepreneurs.
"We presented projects in energy, agriculture, and infrastructure, as well as large-scale public-private partnership initiatives and attractive privatization opportunities," Svyrydenko said on Sunday.
In a post on LinkedIn, Svyrydenko said Ukraine's delegation will in the coming days hold dozens of meetings in Saudi Arabia to prepare for the arrival of President Volodymyr Zelensky.
"In particular, we are working on signing important economic agreements with countries in the region," she wrote.
"Today, the call to invest in Ukraine without waiting for the war to end can be illustrated with concrete examples from Saudi businesses," Svyrydenko said, mentioning FAS Energy, which is developing a 112 MW solar park in Kyiv, and SALIC, a subsidiary of Saudi Arabia's Public Investment Fund, which acquired a 12.6% stake in Ukrainian agricultural producer MHP.
Svyrydenko said her delegation observed considerable interest in projects presented during the meeting on Sunday, particularly in infrastructure, energy, innovation, and agribusiness, with a notable focus on fertilizer production.
Svyrydenko emphasized that Saudi Arabia has so far allocated $500 million to support Ukraine's recovery, while Ukrainian exports to Saudi Arabia rose to $368 million in 2024 from $291 million in 2023.
Later on Sunday, Ukraine's Economy Ministry said in a press release that Ukraine and Saudi Arabia will hold a joint business forum in May, which should contribute to the development of bilateral contracts, attracting investments in Ukraine, and boosting trade relations between the two countries.
Ukraine state company Ukroboronprom to form JV with French defense giant Thales
Ukraine's state defense company Ukroboronprom and French multinational aerospace and defense corporation Thales have signed a memorandum to establish a joint venture.
The agreement was signed on the sidelines of the Munich Security Conference, Ukraine's Ministry of Defense said.
"The aim is to create advanced technological solutions and provide optimized and operational support in the areas of air defense, radar systems, electronic warfare, tactical communications and optoelectronic systems," the ministry said in a press release on Saturday.
The ministry hasn't provided more details on the joint venture.
Headquartered in Paris, Thales designs, develops, and manufactures a wide variety of aerospace and military systems, devices, and equipment.
Ukraine gets equity funding offers for Khmelnytskyi NPP from several investors, energy minister says
Ukraine has received offers from several investors to take part in funding the completion of power units 3 and 4 at the Khmelnytskyi nuclear power plant (NPP) in exchange for ownership in the project, Energy Minister Herman Galushchenko said.
Galushchenko said at a briefing in Ukraine's parliament that the government hasn't so far considered involving third parties in the project, but noted there are many such requests "including from large companies from neighboring states."
"I think that we will still focus on leaving the funds and implementing this commercial project as a state project," Galushchenko stated on Friday, as quoted by Interfax Ukraine.
On Feb 11, Ukraine's parliament voted in favor of a bill allowing state-owned nuclear energy operator Energoatom to buy two Russian-made nuclear reactors from Bulgaria to complete Khmelnytskyi's units 3 and 4.
Meanwhile, however, a draft law has been submitted to the Bulgarian parliament seeking to cancel a permit to sell the reactors to Ukraine, according to Galushchenko.
"We are now very closely monitoring what is happening in the Bulgarian parliament so that this decision is not overturned, because then we lose this opportunity," Galushchenko said, adding that it would take five years to manufacture the reactors from scratch.
Bulgaria bought the reactors from Russia for the construction of the planned Belane NPP but later abandoned the project. In July 2023, the Bulgarian parliament authorized the country's energy minister to start talks on the potential sale of the reactors to Ukraine at a sale price not lower than €601.6 million - equal to what Bulgaria eventually paid to Russia's Atomstroyexport for the equipment.
The acquisition of the reactors would give Ukraine an additional 2.2 GW of guaranteed base generation, the energy ministry said earlier.
The Khmelnytskyi NPP, located in western Ukraine, currently has two working reactors and is one of three operational nuclear power plants in the country under Kyiv's control.
EBRD signs a second $100 million revolving credit facility in hryvnia with Citi Ukraine
The European Bank for Reconstruction and Development (EBRD) and Citi Ukraine have signed a $100 million revolving credit facility in Ukrainian hryvnia with Citi Ukraine, its second such facility in about a year.
The latest facility is meant to ensure the EBRD secures access to local currency liquidity while offering loans in the local currency, both directly and through other financial institutions, to existing and potential clients in Ukraine, the EBRD said.
"The funds will be used to support their liquidity, short-term working capital and trade-finance needs, while limiting currency exchange-related risks," the EBRD said in a press release.
Citi Ukraine is relying on its Local Currency Financing Solutions initiative launched last year for this facility, which "aims to facilitate capital mobilisation in local currencies to deliver financial stability by reducing risk, aligning with responsible banking practices and empowering local borrowers to navigate their financial obligations with greater confidence," according to the release.
The EBRD said it has been working increasingly over the past decade with local stakeholders to improve its access to local currency and help develop domestic financial markets.
In January of 2024, the lender announced another $100 million revolving credit facility in Ukrainian hryvnia with Citi Ukraine, calling it at the time "the largest facility of its kind in hryvnia signed to date between the two institutions."
Washington Post: In a Russia-Ukraine peace deal, one issue is beyond questioning
Vladimir Kara-Murza, a Russian politician imprisoned for more than two years for speaking out against the invasion of Ukraine, wrote in an op-ed piece for The Washington Post that many details have to be worked out for a ceasefire but one issue "is beyond questioning."
Russian forces have captured tens of thousands of Ukrainian civilians. "Many of the hostages are held incommunicado; many are enduring torture and inhumane conditions. Even children are being jailed by Russian authorities. Securing their release as part of any postwar settlement is an absolute must for Western negotiators."
The Hill: Getting Ukraine settlement right requires pressure on Putin
The US and its allies must ramp up pressure on Russian President Vladimir Putin ahead of peace talks to ensure the peace will last, and not serve as a chance for Putin to "reconstitute his forces and attack another day," according to an op-ed piece in The Hill
"The way to get Putin to the negotiating table is through increasing U.S. and allied military assistance to Ukraine, tightening sanctions against Russia, seizing frozen Russian assets kept in Western financial institutions and readying a European deterrent force," said the authors.
Americans remain split on US aid to Ukraine along party lines, survey finds
Americans remain deeply split along party lines on US aid to Ukraine, with 30% of American adults overall saying the US is providing too much support to Ukraine in the war with Russia, a Pew Research Center survey conducted between Feb. 3-9 found.
Republicans and Republican-leaning independents are much more likely than Democrats and Democratic leaners to believe that the US is providing too much support to Ukraine (47% vs. 14%). This sentiment among Republicans has risen by 5 percentage points since November.
In contrast, Democrats are far more likely than Republicans to feel that the US is offering too little support to Ukraine (35% vs. 10%), with this view increasing by 7 points among Democrats since November.
A slightly higher percentage of Americans now believe that supporting Ukraine benefits US national security compared to April 2024 (39% today vs. 36% then).
However, significant partisan differences are also evident on this issue. Democrats are far more likely than Republicans to view US support for Ukraine as beneficial to national security (53% vs. 27%). In contrast, Republicans are much more likely than Democrats to believe that it harms national security (40% vs. 21%).
In addition, Republicans are significantly more likely than Democrats to believe that European allies should boost their defense spending (50% vs. 30%). However, the share of both Republicans and Democrats who hold this view has declined since 2024.
Pew Research Center noted the survey was conducted before US President Donald Trump talked on the phone with Russia's President Vladimir Putin.
The survey saw participation from 9,544 US adults.
Investment Incentives
UkraineInvest, the state investment promotion agency, promoted a guidebook it has prepared to explain how investment incentives in Ukraine align with the European Commission's call for expressions of interest under the Ukraine Investment Framework.
In the call for expressions of interest, issued in November last year, the EC called on private businesses to submit investment proposals of at least €50 million each that could form part of the European Union's €50 billion aid package for Ukraine.
Investment Map of Ukraine
The European Business Association, which represents European businesses operating in Ukraine, promoted its Investment Map of Ukraine, "an interactive platform developed by the EBA, GB4U and UkraineInvest to facilitate investment in Ukrainian business and communal projects."
The Investment Map of Ukraine shows key investment opportunities in 15 sectors of the economy, data on resources in all regions of Ukraine, individual projects open for partnership and more.
Dutch Investors
Reinoud Nuijten, senior adviser on international trade to the Dutch Ministry of Foreign Affairs, recapped last week's information session for Dutch businesses looking to participate in the reconstruction of Ukraine.
Takeaways include that "early movers will benefit the most" and that "Dutch expertise in agriculture, water management, healthcare & life sciences, energy and circular construction is highly sought after in Ukraine’s rebuilding efforts."
Benefits of Business Associations
Vira Savchenko, CEO of BDO in Ukraine, published a social media post promoting the benefits to companies of joining business associations in Ukraine and the access they allow to policymakers.
"My foreign colleagues do not believe me when I say that over the past couple of weeks ... I attended meetings with the Minister of Economy and her three deputies, the Minister of Digital Transformation and his deputy, the Ministers of Energy and Finance, the head of the NBU and even with the European Commission," she wrote, in machine translation.
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