Ukraine’s state budget on Thursday received a $1.5 billion concessional loan through the World Bank’s Trust Fund mechanism under guarantees from the Japanese government, the Finance Ministry said.
“The raised funding will be used to restore the economy and strengthen social protection of the population,” the release quoted Finance Minister Serhiy Marchenko as saying, thanking the WB and Japan for the allocation of funds.
The Finance Ministry recalled that since the beginning of Russia’s full-scale invasion, Ukraine has received more than $581 million in concessional financing from the Japanese government through the Japan International Development Agency (JICA).
“This year, the Japanese government is expected to provide another $2 billion in direct budget support through the World Bank Trust Fund,” the ministry added.
As previously indicated by the Ministry of Finance, as of July 21 this year, Ukraine’s state budget received funding from international partners in the amount of $23.6 billion, compared to $32.1 billion last year, with a need for this year of about $42 billion.
Since then, the budget has also received EUR1.5bn of the sixth tranche of EU macrofinancial aid.
The Ministry of Defense of Japan held a ceremony of transferring to Ukraine 100 vehicles and 30,000 ready-made food rations for the needs of the Armed Forces of Ukraine, the Ukrainian Ambassador to Japan Sergey Korsunsky said.
“Today in the Ministry of Defense of Japan there was a ceremony of handing over to Ukraine 100 vehicles and 30,000 ready-made food rations for the needs of the Armed Forces of Ukraine. The first two vehicles are already on their way to Ukraine, the others will be sent after passing the technical inspection and necessary preparation,” he wrote on Facebook.
The ambassador stressed that for the first time in Japan’s post-war history, the Self-Defense Forces are transferring military equipment to a belligerent country.
“Continuation follows,” Korsunsky added.
Ukraine and Japan will hold a joint conference on the reconstruction of Ukraine, President Vladimir Zelensky said on his website following his meeting with Japanese Prime Minister Fumio Kishida at the G7 summit.
In particular, the parties agreed to hold a Ukrainian-Japanese conference on the restoration of Ukraine and to involve private business in this process.
The leaders discussed the possibility of Japanese investment in the production of hydrogen, lithium batteries, cars, energy equipment, as well as in the construction of overpasses and railway infrastructure.
Zelenskyy reportedly thanked Japan for the allocation of a 7.6 billion dollar financial aid package, as well as for the decision to admit wounded Ukrainian servicemen to the Self-Defense Forces hospital for treatment and for additional aid in the form of 100 trucks for the needs of the AFU.
Zelenskyy and Kishida discussed further steps for assistance to Ukraine by the Japanese government, in particular to strengthen the material and technical capabilities of the Ukrainian defense forces.
The head of state stressed that Ukraine counts on Japan’s support for a global summit on the implementation of the Ukrainian peace formula.
Ukraine will receive 300 million yen (equivalent to almost 80 million UAH) from Japan to buy medical equipment that will equip Ukrainian hospitals with modern medical equipment, particularly endoscopes, the press service of the Cabinet of Ministers said.
“The Government of Ukraine has approved the draft Agency Agreement on the implementation of the Japanese grant aid. The agreement will be concluded between the Government of Ukraine and the company Crown Agents Japan Ltd”, – reported on the government portal.
Grant assistance in the amount of 300 million Japanese yen (the equivalent of almost 80 million UAH) is provided for the purchase of special equipment (endoscopes) for Ukrainian medical institutions, according to the press service.
“The health care system is one of the most affected by the war – the full-scale invasion of the Russian Federation has put a great strain on it. This is due not only to the mass systematic destruction of medical facilities, but also to the growing demand for certain types of medical care and services that were not previously a priority. Already now, 177 health care facilities have been completely destroyed, with 1,433 damaged. We are working not just to restore the damaged, but to rebuild better,” said Health Minister Viktor Lyashko, quoted by the press service.
According to him, for more than a year, Ukraine together with its partners manages to ensure the uninterrupted functioning of hospitals even near the front lines.
“Despite the shelling and the challenges faced by the Ukrainian healthcare system, with the support of international partners we are restoring the medical infrastructure, and the best equipment continues to appear in our hospitals. A grant from Japan will provide even more Ukrainian doctors and hospitals with modern medical equipment, which will make quality medical care more accessible to Ukrainian patients. We are very grateful for such a strong shoulder of help at a difficult time for us,” the minister said.
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.
