The Japanese government has announced a $471 million contribution to the World Bank’s Ukraine Recovery, Rehabilitation and Reform Trust Fund (URTF).
“This contribution is part of a $5.5 billion pledge Japan made in February to help rebuild destroyed infrastructure and support the people of Ukraine in rebuilding. Of the pledged amount, $5 billion is loan coverage that will support World Bank loans to Ukraine next year,” the WB said in a release Saturday.
According to Japanese Deputy Finance Minister Kentaro Ogata, Japan expects its contributions to be used effectively to meet Ukraine’s urgent critical infrastructure repair needs.
The URTF is a multi-donor fund that supports World Bank emergency operations in Ukraine in key sectors including transportation, health and energy. These projects reflect the country’s emergency assistance needs outlined in an updated Rapid Damage and Recovery Needs Assessment (RDNA) published last month. The projects are designed to be adaptable to what’s happening on the ground, while making a quick impact.
This grant contribution more than doubles URTF funds, WB points out. Total grant resources for urgent repairs to energy infrastructure, roads, bridges, housing, schools, and hospitals now total more than $850 million. URTF now supports the Energy Recovery and Winterization Preparation Project, the Rehabilitation of Essential Logistics Infrastructure and Networking (RELINC) and the Health System Strengthening and Life Preservation (HEAL) Project.
In the new RDNA, the World Bank estimated that Ukraine will face an $11 billion funding gap in 2023 to cover critical economic and capital spending.
The URTF was established in December 2022. The fund helps Ukraine plan and implement a recovery, sustainable recovery and reform program. Using a framework approach, URTF ensures that the Ukrainian authorities can effectively and extensively leverage multiple sources of funding.
URTF is strategically guided by a Partnership Council. It is co-chaired by the World Bank Group and the Government of Ukraine and includes development partners. URTF participants include Austria, Canada, Iceland, Japan, Lithuania, the Netherlands, Norway, Sweden, and Switzerland. The Program Management Team is responsible for the day-to-day management of URTF participants’ funds.
Deputy Prime Minister for Reconstruction of Ukraine – Minister of Development of Communities, Territories and Infrastructure Alexander Kubrakov and Senior Deputy Director General of Japan International Cooperation Agency JICA (JICA) Hideya Kobayashi signed an agreement on grant allocation from the Japanese government.
According to the press service of the Ministry of Reconstruction, it is about allocation of grant of 400 million dollars to Ukraine, the agreement on which was agreed in the end of March 2023. The money will be allocated as part of the Emergency Recovery Program aimed at critical infrastructure.
“This is the second grant agreement signed with the international cooperation agency JICA. This support allows us to quickly and efficiently implement projects of rapid and humanitarian recovery. First of all, we are talking about providing for the basic needs of our citizens and the restoration of critical infrastructure,” Kubrakov noted.
As noted in the press release, funds will be allocated to improve and support the following areas: equipment for humanitarian demining; transport services; energy services; management of waste of destruction; water supply; medical equipment; equipment for educational services; agricultural sector; public broadcasting sector; municipal services sector at the local government level.
“In addition, the government of Japan will provide $70 million in grant support for the reconstruction of Ukraine through the mechanism of the United Nations Development Program. In total, since the beginning of the year an agreement has been reached between Ukraine and Japan on the allocation of more than 600 million dollars for the reconstruction of Ukraine,” – noted in the Ministry of Reconstruction.
The Japan International Cooperation Agency (JICA) is a governmental organization for technical, grant (gratuitous) assistance and preferential loans to foreign governments. “JICA is one of the largest agencies in the world, providing assistance to more than 150 countries and being Japan’s “only window” through which all kinds of development assistance are provided.
Traders are awaiting the release of data from the U.S. Labor Department on the country’s consumer price movements last month, which are considered key to the Federal Reserve’s (Fed) decision on the future direction of monetary policy.
“All markets are clearly focused on the extremely important U.S. inflation data,” notes SPI Asset Management managing partner Stephen Innes, quoted by Market Watch. – Traders are trying to figure out whether the Fed will change course after this data and what the implications for the U.S. economy will be.”
Experts polled by Trading Economics on average expect U.S. inflation in March slowed to 5.2% on an annualized basis from 6% in February.
Higher-than-expected inflation would raise the likelihood of another Fed rate hike by at least another 25 basis points. The U.S. central bank rate hike has already slowed inflation, but it is also holding back the economy. A further rate hike would increase the threat of recession, which would have a negative impact on stock markets, notes Market Watch.
Japan’s Nikkei 225 stock index gained 0.6% in trading.
SoftBank Group shares gained 1.4 percent, Nippon Yusen rose 2.4 percent, Mitsubishi Corp. – by 2.3%, Nippon Steel by 1.8% and Nintendo by 1%.
Bank of Japan data released Wednesday showed the country’s producer price growth slowed to an annualized 7.2% in March from February’s 8.3%. The rate of increase in producer prices last month was the slowest since September 2021.
China’s Shanghai Composite stock index added 0.3 percent in trading, while Hong Kong’s Hang Seng lost 0.8 percent.
The leaders in mainland China are commodities stocks – Petrochina Co. (SPB: 857) gained 3.4 percent, China Petroleum & Chemical Corp. (Sinopec) gained 1.7 percent and Zijin Mining Group Co. – by 0.7%.
Shares of technology giants are becoming cheaper in Hong Kong. Alibaba Group Holding (SPB: BABA) was down 2.4%. On Tuesday, the company unveiled its own artificial intelligence model, a ChatGPT counterpart that works with Chinese and English. The model will be integrated into all business applications in Alibaba’s ecosystem in the near future, the company said.
According to Bloomberg, Chinese authorities are planning to introduce the requirement of safety checks of technologies similar to the popular chatbot ChatGPT.
Shares of Tencent (SPB: 700) Holdings Ltd. fell 4.4% in trading and JD.Com Inc. (SPB: JD) fell 3.4%.
South Korea’s KOSPI stock index is stable in the course of trading, the Australian S&P/ASX 200 added 0.4%.
BHP Group shares rose 2.1%, Rio Tinto – 2.5%, Fortescue Metals – 1.5%.
In 2023-2028, Uzbekistan will implement a project to create a value chain in the fruit and vegetable industry with the participation of the Japan International Cooperation Agency (JICA).
The total cost of the project is $323 million, including:
– a loan from the Japan International Cooperation Agency (JICA) – $200 million;
– the contribution of the Republic of Uzbekistan to the Project in the form of value added tax coverage and customs duty exemptions – $58.3 million;
– contribution of Project participants (loan recipients – Project initiators) – $64.8 million.
The project is being implemented in all regions of Uzbekistan, and its implementation period is 6 years – from 2023 to 2028.
The International Center for Strategic Development and Research in Food and Agriculture under the Ministry of Agriculture of Uzbekistan has been appointed as the executive body responsible for the timely and complete implementation, coordination and management of the project.
Ukraine will receive a $170 million grant from Japan to implement Ukraine’s “Rapid Recovery Plan,” Japanese Ambassador Matsuda Kuninori and Deputy Prime Minister for Reconstruction and Minister of Community Development, Territories and Infrastructure Oleksandr Kubrakov signed the agreement on Friday.
According to the Ministry of Reconstruction, the day before, the deputy prime minister also signed a memorandum under which the United Nations Development Program (UNDP) will independently oversee the use of funds for housing reconstruction in the Kiev region.
“Transparency and accountability are the basic principles of the approach to reconstruction. Without fulfilling these conditions, the involvement of international partners and, in general, the effective restoration of the destroyed is impossible (…) We plan to scale the successful experience of supervision and cooperation with UNDP in matters of independent supervision to other restoration projects in different regions of Ukraine”, – Kubrakov noted.
According to him, similar cooperation is planned with other international organizations – financial or expert.
In addition to independent oversight, UNDP will support digitalization of reconstruction, development and monitoring processes in regional development, work on enhancing the capacity of local governments to implement infrastructure projects, community access to international donor funding and energy efficiency of social infrastructure.
In addition, the UN Development Program will provide technical support to Ukraine in reconstruction.
As reported, the Government of Japan has allocated $170 million for Ukraine’s reconstruction, and before that another $95 million, which was sent to the UNDP Development Program in the framework of a partnership agreement.
In addition, in January, the “Recovery” direction was launched within the framework of the fundraising platform United24. Due to it, 18 apartment buildings in Irpen, Borodyanka, Gostomel, Buzova and Mily will be fundamentally repaired and about 4000 residents will be able to return into their homes by the end of 2023. For this purpose, according to the decision of the government, more than 500 million UAH collected at the special account of United24 will be directed.
Japan will hold an online G7 meeting on February 24, which will be joined by Ukrainian President Vladimir Zelensky, in addition, Tokyo will allocate $5.5 billion in aid to Ukraine, the Associated Press quotes the statement of Prime Minister of this country Fumio Kishida.
During his speech at a forum in Tokyo, Kishida said that his country will host the first summit of the G7, which will be held on February 24.
He also announced that Japan will provide assistance so that Ukraine can “rebuild daily life and infrastructure.
