EBRD Assists Ukraine in Identifying Export Solutions, According to Reuters

By Ahmed Eljechtimi

MARRAKECH, Morocco – The European Bank for Reconstruction and Development (EBRD) is contemplating financial assistance for Ukraine’s transportation and logistics sectors to sustain its export activities, according to a senior official from the bank.

Recently, Ukraine officially shut down its four ports on the Black Sea and Azov Sea, which have been seized by Russian forces, leaving land routes through neighboring countries as the sole option for exports.

As a result, Ukraine faces the risk of losing millions of tonnes of grain exports due to Russia’s control of shipping in the Black Sea, potentially leading to a global food crisis and increased inflationary pressures on food commodity markets.

The EBRD aims to provide a liquidity line to Ukraine’s rail company, UZ, to ensure it can continue operations and facilitate the export of Ukrainian goods, as stated by Matteo Patrone, the bank’s eastern Europe head, during its annual meetings in Marrakech.

“We are working with logistics companies to explore how we can support them with liquidity lines,” Patrone noted.

This initiative encompasses Ukraine’s postal services as well as various private and public sector companies, including municipal entities.

Discussions between the EBRD and Ukraine’s infrastructure ministry are exploring strategies to upgrade cross-border and transhipment infrastructure, Patrone added.

A trader highlighted that the rail system can currently export only a small portion of the grain stored in Ukraine’s silos. The rail company will need to modify its infrastructure and equipment to handle cross-border grain shipments effectively.

Additionally, the bank is in the initial stages of negotiating liquidity lines to assist Ukraine’s neighboring countries in coping with disruptions to Russian gas supplies, although details were not disclosed.

“We are also in discussions with Naftogas regarding potential liquidity support,” Patrone mentioned.

The EBRD has indicated its intention to invest 1 billion euros in 2022 to support Ukraine’s economy.

European Union Commissioner for Trade Valdis Dombrovskis has estimated the cost of war-related damage to Ukraine to be between 500 billion and 600 billion euros.