What should be the priorities of a future Marshall Plan for Ukraine? Members

Published December 8, 2022
Reading | 6 min

I would like to start the Essay with my general principles and beliefs: in economic standpoint I am conservative, meaning I view economy as class of self-reliant and self-interested individuals who seek development and prosperity. Everyone should be awarded based on his/her talents and the intensity, determination and hard work. Thus, my views on the priorities on a future Marshall Plan for Ukraine do correspond with my general beliefs.

To start with, Marshall Plan for the post-war Ukraine (hereinafter – Plan) should be designed to work long-term, and its main goal shall be – free, stable, self-reliant and strong Ukraine, with democracy deeply rooted, and free market economy well established. A country – a reliable friend and ally to the US, EU and the West, as a whole. A prominent regional leader and economic power.

In order to make a Plan efficient – several objectives should be established – and those shall reveal key results to be met in short-medium- and long-term perspective. Short term objectives are aiming at granting people, who seek support, with the resources necessary for quick recovery of their property and businesses. Mid-term goals are aiming at stabilising the country and providing capital investments in Infrastructure and Economy. Long-term aim is to make Ukraine a win-case in terms of applying Western standards of Thinking, Living and Governance.

The Plan can be categorised in such a way:

People. Their skills. SME

  • Russia has deliberately targeted the industrial centres of Ukrainian economy with its shelling during the war. Steel, oil-refinement plants, as well as elevators and power grid facilities – were destroyed with purpose. Many of the destroyed objects are unlikely to be rebuilt, and Ukraine faces now, and will face in the future, the dramatic rise of unemployment in once economically developed regions.
  • So first – is the direct support of individuals who lost their jobs and businesses. The Plan should make it possible for those who want to start businesses, and those who lost or got damages to their small or medium enterprise businesses, make them up and running again. Of course, the recipients must provide a vital plan for repairing, gaining stability and reaching the profitability point for their SMEs.
  • We should not forger about those who lost jobs. People should realise that their past skills may not be relevant in the present and future. To help smooth the transition, the Plan should support the qualification change courses, so people could apply their new skills in modern-world ares, such as IT, Pharma, Agriculture.

Infrastructure, Economy and Logistics Corridors

  • Infrastructure – is vital for future sustainable development of Ukraine. Every dollar, euro or hryvnia, properly invested in infrastructure – returns with multiplication.
  • We as a country have a unique location, but a legacy infrastructure. To start with, the rail road should be demonopolised, and multiple carriers should compete to ship goods at faster pace and at lower price. Thanks to open skies agreement with the EU, all barriers for flights to/from Ukraine – will be over, thus we will have to invest in airports that will have a robust client base. Ukrainian ports help export Ukrainian goods – we have to ensure the proper logistics to/from them, as well as reduce the service toll for using them, to make them competitive with those in Romania, Bulgaria and Turkiye. We need to start building highways, especially those leading westwards towards the border. We should keep reforming the inner water market, so our rivers are used for transportation again. To sum up, developing and enriching the logistics corridors – is a must for a growing economy.
  • Ukraine is grateful to the EU and the UK for establishing a special regime for Ukrainian goods, a «visa-free» for goods. Such measure should be extended to a few years to gain the most from post-war recovery, and make Ukrainian goods and services competitive globally.

Energy and its Modernisation

  • Energy has a big proportion in nation’s GDP. Ukraine is a peaceful nuclear country, and this, I am confident, should be preserved. Ukraine vitally needs cheap energy sources, and the nuclear energy is exactly this king of a source. The Plan shall be used to invest in repairing, modernisation and building new reactors.
  • Thanks to integration of Ukrainian electricity grid with ENTSO-E, Ukraine had started exporting its electricity onto European market in 2022. Because of Russia’s deliberate shelling of our energy infrastructure, such export was put on hold, as Ukraine suffers from severe blackouts. The Plan should pay great attention to normalising the electricity grid and bringing the transmission system (and its components) back to normal. I do hope that, once electricity market is stabilised, Ukraine could resume electricity export, and the amounts of electricity Ukraine is eligible to export – will be growing slowly, but steadily.
  • We have yet decide what to do with our national gas transportation system: Russia is not a reliable partner, and the era of Russian gas being transported to Europe – seems, comes to an end. Ukraine will lose around $2b/year after current contract ends, and the Plan should consider investing in renovating of Ukrainian gas transportation system – to operate with hydrogen rather than gas, as a potential future green source of energy.
  • Over the past few decades, Ukraine has dramatically decreased the usage of natural gas, but mostly it happened due to de-industrialisation, rather than savvy usage. Ukraine has already started the thermal modernisation for buildings, and this policy should be preserved: local municipalities to be given grants for co-funding with home owners to further reduce energy consumption.

Communities and People Potential

  • Decentralisation was the most effective, popular and consequential reforms ever implemented in Ukraine. Being a unitary country, local authorities got the needed powers, resources and tools to influence their communities. Investing in municipal schools, hospitals, facilities for entertainment, municipal transportation – made people “feel and see” the beginnings of inclusiveness, their ability to influence local authorities, and transform lives around them. A successful nation may only be successful, if it invests in education and health care. The Plan should provide grants or low-cost loans for municipal communities to invest more in CAPEX, thus transforming those communities and making them thriving.
  • In order to make a Plan successful – it has to be implemented by professional people both in the government, and in local municipal authorities. Ukraine must proceed with reforming its pubic service system. To accelerate the positive effect – I would propose Ukrainian governmental and local officials are trained and advised by their western colleagues, to make Ukraine able to apply a Plan in life, by following the best practices of good and fair governance.

Ukraine and the West are stronger together!

The Essay above expresses my personal ideas and thoughts on how such a Plan could look like. I understand that Ukraine’s needs may change greatly, even in a near future. And that a lot is dependent on the situation on the battlefield. Despite this fact, the text above may be used as a discussion starter. And, on my view, it is the right time to launch such a discussion. Welcome!

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