Today's Contents
Reporter's Notepad:
- A busy news week. Have a good weekend!
Just The Facts:
- Zelensky proposes first steps towards peace as EU leaders pledge support
- Norway more than doubles budgeted 2025 aid for Ukraine to €7.8 billion
- Ukrainian, US officials to meet in Saudi Arabia next week
- EIB, Ukraine to create team of experts to help carry out investments under Ukraine facility
- Trump says he will decide 'pretty soon' whether to revoke legal status of Ukrainians
- Japan's development fund agency mulls taking over from USAID in Ukraine's energy, infrastructure projects
- Ukraine aims for annual exports equal to 33% of GDP by 2030
- Swedwatch gets SEK 1.7 million to work on responsible business practices in Ukraine amid reconstruction
Here's What They Think:
- Jeffrey Sachs: Negotiating a lasting peace in Ukraine
- Newsweek: Here's What a Ukraine Peace Deal Could Look Like
Sober Second Thought:
- $60 billion in US military aid is actually worth $18.3 billion, CEP study finds
Dear subscribers,
It's been a very busy news week.
It started Monday with news that France and UK would propose a 1-month truce in the air and on the sea, plus pressure on Norway to boost aid to Ukraine, and our advice column on banking with Citi Ukraine head Alexander McWhorter.
By Tuesday, we learned that 29% of Ukrainians rate the US as a hostile nation - and that was a survey taken before they learned the US was pausing all military aid to Ukraine.
On Wednesday, readers learned that titanium miner Velta is in talks with the EBRD, EIB and DCF for backing to create a "cluster" in Ukraine for mining and processing critical raw materials when the war ends. They also read that the US and Ukraine plan to go ahead with a minerals deal.
On Thursday, the EIB and European Commission signed a a guarantee agreement that will allow the EIB to invest at least €2 billion in urgent recovery and reconstruction projects in Ukraine.
And today, Friday, we read that Norway agreed to more than double its aid planned for Ukraine this year to about €7.8 billion, that Zelensky will meet US officials next week in Saudi Arabia and that $60 billion in US military aid is really worth $18.3 billion.
Next week looks at least as busy as this week.
Have a good weekend. Rest up!
Zelensky proposes first steps towards peace as EU leaders pledge support
Ukraine's President Volodymyr Zelensky participated on Thursday in a meeting of the European Council in Brussels where he presented what he called "necessary steps for peace."
Firstly, Zelensky argued, "Everyone needs to make sure that Russia, as the sole source of this war, accepts the need to end it."
According to Zelensky, Russia's willingness to end the war "can be proved by two forms of silence …, namely, no attacks on energy and other civilian infrastructure – truce for missiles, bombs, and long-range drones, and the second is truce on the water, meaning no military operations in the Black Sea."
"The next step is basic trust to the circumstances in which the negotiations are taking place," Zelensky said at the meeting.
He emphasized that any truce should be viewed as just the first step toward a comprehensive agreement to end the war and offer security guarantees to Ukraine.
"Let me emphasize once again that Ukrainians do really want peace, but not at the cost of giving up Ukraine. Is Russia capable of giving up the war – this is the question that any negotiations must answer," Zelensky said.
The EU leaders met on Thursday to discuss the European Commission's proposal to mobilize €800 billion to enhance Europe's defense capabilities and provide military aid to Kyiv, which included a new EU instrument to provide member states with loans backed by the EU budget of up €150 billion.
The EU leaders called on their ministers to examine the proposal as a matter of urgency, according to a joint communique published following the meeting.
The European Council also reiterated the EU's support for Ukraine, saying the country must be involved in any negotiations to end the war, that any ceasefire can take place as part of a process leading to a comprehensive peace agreement, and that any such agreement must include security guarantees.
Norway more than doubles budgeted 2025 aid for Ukraine to €7.8 billion
Norway will more than double the amount of aid budgeted for Ukraine this year to about €7.8 billion, Prime Minister Jonas Gahr Støre announced after a meeting with leaders in parliament.
"‘We are contending with the most serious security situation in Norway since the Second World War," he said. "This funding represents a major Norwegian contribution to peace and stability in Ukraine and in Europe."
The government decided to add NOK 50 billion (€4.3 billion) in aid to the already budgeted NOK 35 billion, bringing the total to NOK 85 billion, as it faced pressure to dip into its $1.7 trillion Government Pension Fund Global, the world's largest sovereign wealth fund.
The government said in a press release that the aid will be coordinated with the aid of other European nations, with an emphasis on control systems to ensure the funding is used for its intended purposes.
The government was facing calls to change a budget rule introduced in 2001 that prevented it from spending more than 3% or 4% of the fund per year, but Finance Minister Jens Stoltenberg, a former NATO chief, said the higher amount falls within the budgting allotment.
"The funding will be used in its entirety in connection with international initiatives and procurements from the Ukrainian defence industry," he said. "The additional allocation is in line with the fiscal rule on the use of petroleum revenues."
The increased allotment this year will bring total budgeted Norwegian aid for Ukraine through 2030 to €21.2 billion, the government said in the release.
Zelensky says Ukrainian, US officials to meet in Saudi Arabia next week
Ukrainian President Volodymyr Zelensky said he will travel to Saudi Arabia on Monday to meet with Saudi Crown Prince Mohammed Bin Salman ahead of talks between Ukrainian and US officials later in the week.
"Next Monday, I have a visit planned to Saudi Arabia for a meeting with the Crown Prince. After that, my team will stay in Saudi Arabia to work with our American partners," Zelensky wrote in a post on X on Thursday.
Zelensky added that Ukraine is "most interested in peace."
"As we told the President of the United States, Ukraine is working and will continue to work constructively for a swift and reliable peace," Zelensky wrote.
US special envoy Steve Witkoff said earlier on Thursday that discussions are ongoing to "coordinate a meeting with the Ukrainians in Riyadh, or even potentially Jeddah."
"The idea is to get down a framework for a peace agreement and an initial ceasefire as well," Witkoff told reporters at the White House.
EIB, Ukraine to create team of experts to help carry out investments under Ukraine facility
The European Investment Bank (EIB) and Ukraine signed an agreement on Thursday to deploy a team of advisors in Kyiv to support the implementation of EIB investments under the Ukraine Facility, the EIB and Ukraine's Economy Ministry said.
The specialists will accelerate the preparation and implementation of critical projects, initially focusing on energy, transport, and social housing. Over time, their scope will expand to include other sectors, such as public investment management reform.
This initiative is led by EIB Advisory through a €20 million JASPERS advisory package for Ukraine, co-financed by the European Commission (EC) and the EIB's EU for Ukraine advisory program in 2024, EIB said.
"This reconstruction requires not only financial resources, but also technical expertise, strategic planning and high-quality project preparation. Thanks to JASPERS' support, we have access to world-class expertise that will help us develop investment-attractive projects in key sectors of the economy," Ukraine's Economy Minister Yuliia Svyrydenko stated.
JASPERS (Joint Assistance to Support Projects in European Regions) is the EIB and EC's advisory program that helps countries develop high-quality investment projects.
Since 2022, JASPERS has been helping Ukraine develop transport infrastructure, including creating a strategy to integrate the Ukrainian and Moldovan railway systems into the EU, expanding border capacity to reduce waiting times, and providing guidance on national transport strategies, Ukraine's Economy Ministry noted.
Also on Thursday, the EIB and the EC signed a guarantee agreement that will allow the EIB to invest at least €2 billion in urgent recovery and reconstruction projects in Ukraine.
The funding is part of the European Union's €50 billion Ukraine Facility, the block's financial assistance program for the country, for the period 2024-2027.
Trump says he will decide 'pretty soon' whether to revoke legal status of Ukrainians
US President Donald Trump said on Thursday he would soon decide whether to strip about 240,000 Ukrainians who fled Ukraine due to the war with Russia of their legal status.
"We're not looking to hurt anybody, we're certainly not looking to hurt them, and I'm looking at that. There were some people that think that's appropriate, and some people don't, and I'll be making the decision pretty soon," Trump told reporters in the Oval Office.
Earlier in the day, Reuters reported that the Trump administration is considering the move as part of broader efforts to revoke legal status from more than 1.8 million migrants allowed into the US under temporary humanitarian parole programs, citing an unnamed senior US official and sources familiar with the matter.
All four sources indicated to Reuters that the move to revoke the Ukrainians' status could happen as early as April. They said these plans were in motion before Trump's recent public dispute with Ukrainian President Volodymyr Zelensky.
As of February 2025, 6.9 million refugees from Ukraine have been recorded globally, according to the UN Refugee Agency (UNHCR).
Japan's development fund agency mulls taking over from USAID in Ukraine's energy, infrastructure projects
The Japan International Cooperation Agency (JICA), in charge of the Japanese government's development funding, is considering financing energy and infrastructure projects in Ukraine previously covered by USAID, Ukrinform reported on Wednesday.
"We would like to see what gaps have arisen in the energy sector and try to fill them as much as possible. Of course, we have certain budgetary constraints, but we would like to do more... We have to seriously think about the energy sector and infrastructure, and we will consider these sectors," Hideki Matsunaga, head of JICA's Ukraine office, said during the 5th Ukrainian-Japanese Forum held in Kyiv, as quoted by Ukrinform.
Matsunaga highlighted the differences between the approaches of USAID and JICA, noting that taking over certain USAID-led programs, especially in the legal sector and direct civil society funding, would be challenging, according to the report.
In January, the US State Department issued a "stop-work" order for all existing foreign assistance, including USAID, and paused new aid, exempting only emergency food programs and military financing for Israel and Egypt.
The development came after US President Donald Trump signed an executive order suspending foreign development aid from the US for 90 days pending an assessment of consistency with the country's foreign policy.
JICA re-opened its office in Ukraine in November 2023, after leaving the country in January of 2022 in anticipation of the full-scale Russian invasion.
Japan has allocated a total of $10.46 billion in financial and humanitarian assistance to Ukraine since the start of the invasion, according to the Ukraine Support Tracker of the Kiel Institute for the World Economy.
Ukraine aims for annual exports equal to 33% of GDP by 2030
Ukraine aims to reach an annual export volume of $77 billion by 2030, with its share in GDP amounting to 33%, Deputy Minister of Economy and Trade Representative of Ukraine Taras Kachka said on Wednesday at the International Trade Forum in Kyiv.
Kachka stated this was one of the goals contained in the new National Export Strategy that is currently being developed by the Economy Ministry.
According to preliminary data, Ukrainian exports grew by 13.4% to $41 billion in 2024, the Economy Ministry said earlier in a press release.
Kachka also said the share of exports in Ukraine's GDP over the past 10 years has decreased from 49% in 2014 to 25% in 2023, as quoted by the Economy Ministry.
"The priority of the Strategy is not simply to increase export volumes in monetary equivalent or by weight. We want to focus on increasing the production and export of goods with higher added value," Kachka said at the event.
Ukraine's National Export Strategy until 2030 will have three main objectives: increasing export volumes and improving its structure; strengthening state capabilities, institutions, and tools to tackle export development objectives, and creating favorable conditions for export activities, as per the statement.
Swedwatch gets grant to work on responsible business practices in Ukraine amid reconstruction
Swedwatch, the Swedish non-profit research organization monitoring the impact of companies on the environment and human rights, said it has been granted SEK 1.7 million ($167,300) by the Swedish Institute to work on two projects in Ukraine over the next two years.
One project aims to assess risks and incorporate responsible business practices into Ukraine's reconstruction, focusing on key sectors including agriculture and food production, construction, transport and logistics, IT and digitalization, critical raw materials, and energy.
"From previous research and reporting, we know that many of the sectors identified as crucial for reconstruction are high-risk sectors in terms of human rights and environmental concerns. This makes it particularly important to uphold human rights and responsible business conduct," said Jessica Johansson, Swedwatch Program Officer.
The second project will focus on sharing experiences and collaboration on corporate responsibility within the Eastern Partnership - an initiative aiming to strengthen political and economic relations between the European Union, its member states, and six partner countries, including Armenia, Azerbaijan, Belarus, Georgia, Moldova, and Ukraine - in the context of both the ongoing war and reconstruction efforts, Swedwatch said in a press release on Thursday.
Sweden's aid to Ukraine focuses on humanitarian support, civil crisis management, and reconstruction. It also supports reform efforts, including strengthening democratic governance, advancing EU integration, and improving essential public services like education and healthcare, Swedwatch noted.
As part of this initiative, Swedwatch, in collaboration with Ukrainian partners, will develop expertise in corporate responsibility, sustainability, and human rights, as per the statement.
"We look forward to collaborating with partner organizations in Ukraine and further developing the dialogue on how businesses can take responsibility for human rights and the environment, both during and after the war. The reconstruction efforts in Ukraine are already underway, and companies and investors must get it right from the start," said Alice Blondel, director at Swedwatch.
Jeffrey Sachs: Negotiating a lasting peace in Ukraine
A peace agreement in which Ukraine cedes Crimea and parts of southern eastern Ukraine is likely to be signed in coming months, writes Jeffrey Sachs, director of the Center for Sustainable Development at Columbia University, in an opinion piece in Common Dreams.
As for guarantees to secure the peace, he writes, "the best resolution, in my view, is to put the security guarantees under the authority of the UN Security Council. This means that the U.S., China, Russia, UK, and France would all be co-guarantors, together with the rest of the UN Security Council. This would subject the security guarantees to global scrutiny."
Newsweek: Here's What a Ukraine Peace Deal Could Look Like
A peace deal between Russia and Ukraine must not cede to Russia all the Ukrainian land it currently controls, it should return all kidnapped Ukrainian children to Ukraine, include a US-Ukraine minerals deal and ensure NATO remains strong, according to an opinion piece in Newsweek.
"Right now, Russia controls about 20 percent of Ukraine. Ceding all this land to Russia in a peace deal would incentivize Putin to continue his pursuit of an ethnic empire—now or in the future. Any deal should roll back the land grab to make it clear that the resources and human life lost in the war did not help Russia reach its goal," writes Republican US Congressman Mike Flood.
$60 billion in US military aid is actually worth $18.3 billion, CEPR study says
The $60 billion that the US State Department says it has given Ukraine in military aid is actually about $18.3 billion when accounting for inflated valuations of older weapons, repayable loans and other factors, according to a new paper by the Centre for Economic Policy Research (CEPR).
"Our group of 19 research assistants reviewed thousands of procurement contracts to track each weapon system provided by the US to Ukraine," said the paper's authors, James Hodson, CEO of AI for Good Foundation, and Anastassia Fedyk, assistant professor of finance and UCLA Berkeley.
The would then "consider the vintage of these weapons, assess their depreciation and failure rates, and assign a depreciated value to the old stock actually provided to Ukraine, rather than the replacement value in new weapons obtained by the US."
They also looked at loans versus grants, sought to determine the amount of support that was actually granted to other countries, such as neighboring Poland, under a "Ukraine aid" umbrella, and examined non-military aid from the US to Ukraine, stripping out repayable loans and accounting for US funds used to collateralize loans.
That research suggests all US aid to Ukraine - both military and non-military - totals $50.9 billion, including $32.6 billion in direct budget support and the $18.3 billion in military aid.
"We also note the extensive terms and conditionality of this aid, which meant that the aid was among the most transparent and audited expenditures, and the Government of Ukraine was never in a position to misappropriate any of the funds," the paper said.
The US government valued direct equipment transfers from existing stockpiles at $31 billion, based on US Department of Defense replacement values. However, an analysis of the equipment using age, the US stockpile status, and imputed battlefield failure rates places the value at $12.5 billion.
As one example of the inflated valuations of military equipment, the researchers present a chart showing the value of Stryker armored personnel carriers produced between 2011 and 2024, according to their age.
The depreciated value represents the calculation for the actual value, the authors said, noting that the value of the armored personnel carries, like a car, depreciates every year.
"It should also be noted that the vast majority of the equipment provided to Ukraine is no longer used by the US military and therefore had an effective value of zero to the US, other than as potential military support to allies or as a liability due to stringent requirements for recycling of weapons systems and munitions," the authors wrote.
Social Media Posts
Energoatom Signs Enrichment Deal with Orano
Ukrainian national nuclear operator Energoatom announced on social media that it signed a "major long-term commercial agreement for the supply of enrichment services through to 2040" with French multinational nuclear fuel cycle company Orano.
"This contract guarantees Energoatom a reliable and diversified supply of enrichment services to provide fuel for the Ukrainian nuclear power generation fleet," the company said.
UkraineInvest Weekly Digest
UkraineInvest, the state investment promotion agency, promoted its weekly news roundup, which included items on the International Monetary Fund's agreement with Ukraine, Italian investments and the National Bank of Ukraine's assessment of business performance.
Also covered in the weekly digest is the government's approval the procedure for the preparation, evaluation and implementation of public investment projects and programmes.
EBA Adds 18 Members in February
The European Business Association, which represents the interests of European and Ukrainian businesses operating in the country, announced it added 18 new members in February, bringing the total to 925.
The additions last month included Fairmont Grand Hotel Kyiv, Foodline Production, Gramatskiy&Partners, Green Mill, HLR, Sahlins Sweden AB, Schneider Electric Ukraine, Tekhek-Gas, Tet Cloud Украïна, Ukraine Recovery Fund, Armadum Lawyers, ILC, Doctor Sam, INTEGRITES, KIY AVIA, LTG Cargo Ukraine, Misechko & Partners, Law Firm, Ukrainian-Construction-Allilance and Uni Lux.
'Hints of Optimism' in Milan
Anna Derevyanko, executive director of the European Business Association, posted that she detected "hints of optimism" while in Milan this week attending the "On the Road to URC" event held to prepare for the Ukraine Recovery Conference in Rome on July 10-11.
"Of course, in informal discussions, much of the talk was about international politics and the new trajectory of the US," she wrote. "There’s a sense of uncertainty, and people are hesitant to make predictions, having been wrong too many times before. Still, there were some hints of optimism or at least hope."
URN Daily: Sense Bank and Ukrgasbank for sale? And US seeks to cancel $4.7 billion of Ukraine's debt
