BlackRock and JPMorgan will create a $15 billion fund in Luxembourg for the restoration of Ukraine

BlackRock and JPMorgan will create a $15 billion fund in Luxembourg for the restoration of Ukraine

The Ukraine Development Fund will be registered in Luxembourg. BlackRock and JPMorgan are working to create a public-private JV

The program for private investors to help rebuild Ukraine aims to provide $15 billion in financing, supported by government agencies and capital markets. Bloomberg writes about this.

The Ukraine Development Fund intends to raise at least $500 million from countries, development banks and other grantmakers, as well as $2 billion from private investors, according to Philip Hildebrand, vice-chief executive of BlackRock Inc., who is one of the financiers participating in the discussions.

According to him, this could bring together a consortium of equity and debt investors who could finance at least $15 billion for restoration work in Ukraine.

Hildebrand said the new fund represents a "pretty significant portion" of the $80 billion that could be financed by the private sector, the International Finance Corporation estimates. The Ukrainian government and financial companies have been negotiating for a year and a half to encourage private investment.

The development fund will likely be registered with an international fund center in Luxembourg with an investment committee as well as analysts and researchers, Hildebrand said. The goal, he said, is to create one of the largest public-private partnerships in history, similar to Germany's KfW created after World War II, or the Climate Finance Partnership between BlackRock and several governments in 2021.

The fund's priority areas will be the key sectors of agriculture, manufacturing, infrastructure and energy. Currently, approximately 20 viable projects have been identified out of the 200 assessed. A project preparation center will also be created, which will search for investment-attractive ideas, ensuring their support from investors. According to Hildebrand, his expenses will be reimbursed from investment income.

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