At the end of July, Penny Pritzker, the U.S. Special Representative for Ukraine’s Economic Recovery, visited Ukraine to discuss ways to increase private sector investment and jumpstart Ukraine's economy.

During her visit, she met with senior Ukrainian officials, including Prime Minister Denys Shmyhal, First Deputy Prime Minister Yuliya Svyrydenko, Minister of Digital Transformation Mykhailo Fedorov, and Minister of Strategic Industries Oleksandr Kamyshin. The meetings emphasized the importance of international cooperation and the role of private capital in Ukraine’s recovery.

Despite the war, Ukraine’s economy has shown remarkable growth. In 2023, GDP grew by 5%, investments increased by 17%, and tax revenues rose by 25%. Over 37,000 new businesses were registered, and the tech sector added 8% more jobs.

The international community’s support will be an important element in Ukraine’s recovery. The G7 leaders have committed to unlocking $50 billion from Russian sovereign assets to fund Ukraine’s military, budget, and reconstruction needs. Additionally, the U.S. has been working with local banks to expand financing for small businesses, which are vital to the Ukrainian economy.

Pritzker, whose term as Special Representative ended in August, outlined a plan for Ukraine’s recovery, dubbed “Ukraine’s Path to Prosperity” in a speech at the Brookings Institution on July 31, 2024.

One of the key elements of this plan involves developing a whole-of-government reconstruction planning capacity. This approach aims to streamline efforts across various sectors, ensuring efficient use of resources and alignment with EU accession requirements. The plan also calls for increasing the number of shovel-ready projects, driving reform and anti-corruption efforts, and mobilizing more capital for investment.

Pritzker’s plan also emphasizes the need for a robust insurance system to protect investments and attract investors at scale. Public and private institutions are encouraged to collaborate with local Ukrainian carriers to develop and scale war risk insurance products.

Furthermore, Pritzker pointed out that Ukraine’s recovery will require the return of its people, including internally displaced persons, refugees, and veterans. She urged the Ukrainian government to prepare for their physical, psychological, and social needs, rebuilding housing and schools and providing mental and physical care for war victims.

Pritzker highlighted a number of attractive sectors for investment:

• Ukraine’s agriculture can feed 400 million people worldwide and has the potential to feed 600 million.

• The functioning Black Sea ports have facilitated exports of agricultural products and metals, boosting the state's income.

• Energy, construction, transport, logistics, critical minerals, defense, and technology sectors offer attractive investment opportunities.

She also pointed to recent examples of ongoing projects involving US companies, including Westinghouse and Energoatom's collaboration on the Khmelnytskyi NPP and Amentum's joint venture with the Ukrainian defense industry. In addition to these projects, in July Ukraine and Northrop Grumman signed a deal to produce medium-caliber ammunition, with both countries aiming to foster more co-production deals. A Memorandum of Understanding was also signed last month between Boeing Defense and the Antonov aircraft company to collaborate on aerial drones.

Pritzker’s plan has been characterized as moving Ukraine from a reliance on donors to a focus on attracting investors and capital. As Pritzker aptly put it, “If we build it, they will come.” A combination of continuing donor support, increased foreign investment, and targeted reforms can help ensure a vibrant and successful Ukrainian economy.