First Deputy Prime Minister and Minister of Economy of Ukraine Yuliia Svyrydenko noted that war risk insurance was an extremely important tool for creating a favourable investment climate in the country. Together with international partners, the Government has created a comprehensive war risk insurance infrastructure.
“The Ukrainian ECA has already started insuring against war risks. We have a specific case – a Ukrainian commercial bank issued a loan for the purchase of a gas turbine generator, and the ECA provided coverage for this investment. I am especially grateful that we have the first insurance of investments in the development of alternative power generation and support for the energy sector,” said Yuliia Svyrydenko.
The first Ukrainian company to have its loan agreement insured against war risks was FlexoRes. This company manufactures products for flexographic and rotogravure printing and is a leader in the sale of printing inks in Ukraine. To purchase the mini-TPP, the company entered into a loan investment agreement with MTB Bank under the Affordable Loans at 5-7-9% programme.
The possibility of insuring investments in the development of processing and export of goods against war risks is provided for by amendments to the Law “On financial mechanisms for stimulating export activities”. In May 2024, the ECA started accepting applications from investors in export-oriented enterprises for the use of insurance products.
An investor (Ukrainian or foreign) can apply to the ECA and receive investment protection if:
- it owns more than 10% of corporate rights in the project;
- it invests in the creation of facilities or infrastructure for the development of processing and export;
- the investment objects are located in Ukraine;
- the goods to be exported meet the requirements of the law on export promotion.
A bank providing funds for investment may insure its risks with the ECA if:
- the borrower is a resident of Ukraine;
- the loan is related to investments in facilities or infrastructure for the development of processing and export of goods (works, services) of Ukrainian origin;
- the facilities and infrastructure for which the investment loan is provided are located in Ukraine;
- the exported goods meet the requirements of the law on stimulating export activities.
