Ukraine will need over $800 billion for reconstruction, and attracting such funds and investors will be extremely difficult due to the country's low credit rating, political instability and economic weakness.
This was reported by the Ukrainian publication Strana, citing an analysis by the international consulting firm McKinsey.
Investors are hindered by several factors: the risk of asset depreciation, project interruption, political instability, currency fluctuations, economic weakness and regulatory uncertainty. Even after the end of hostilities, these risks are expected to continue, the publication explains.
According to Strana, the key period of recovery is the first five years. During this time, approximately $360 billion from domestic and external sources will be needed to support the economy and avoid prolonged stagnation.
Ukraine's main problem will be the lack of internal resources: the state budget will be limited, and local enterprises and the financial market will not be able to provide the necessary level of investment. Banks and investors will be cautious, and loans will become expensive due to low credit ratings and the overall level of risk.
Strana stressed that Ukraine's current financing mechanisms are inadequate for current needs. They are mainly aimed at small and medium-sized businesses, while large infrastructure projects remain without sufficient support.
According to a consulting company, even in an optimistic scenario, the initial volume of private investment in Ukraine is estimated at only approximately $2 billion, which means that recovery will be extremely dependent on international institutions capable of raising more significant funds.