Rebuilding Ukraine: Poland should become key investment partner

Since the invasion in 2022, Russia has destroyed nearly 300,000 buildings in Ukraine. About 10% of the housing stock has been wiped out. Industrial damage amounts to $13 billion, while the agricultural sector has suffered $10 billion in losses. The infrastructure has been hit hardest, with nearly $40 billion needed for its restoration, and the housing and utilities sector requires around $60 billion.

Rebuilding destroyed cities and critical infrastructure will take many years and require significant financial resources.

Fortunately, some of these funds are available. EU financial support could be accessible to us even before we become full EU members. Once we join, the amount of funding will increase significantly. The key is learning how to effectively access and manage these resources. In this area, Poland can serve as our best advisor.

Poland fiercely defended its interests when joining the European Union, perhaps even more successfully than any other post-communist country. The Poles have extensive experience and institutional knowledge, and they are ready to share it with us.

In November, Kyiv hosted a major Ukrainian-Polish meeting as part of the Via Carpatia forum, attended by top politicians from Warsaw. They openly called on our officials: "Use us, take our experience."

The Polish politicians who took part in the discussion panel emphasized that they are ready to assist Ukraine not only in securing European funding but also in attracting direct investment, which is crucial for Ukraine's recovery. They believe that grants and interest-free loans alone will not be enough for Ukraine’s successful reconstruction.

“We want to see stronger economic cooperation and for Poland to play an active role in Ukraine’s rebuilding efforts. In sectors like energy, logistics, and infrastructure restoration, Poland is well-positioned to help because we made significant investment strides over the past twenty years, thanks to generous European funding. This European money is already starting to flow to you, and it will increase significantly when you join the EU, which could happen before the end of this decade. We know how to effectively use these investment funds,” said Marcin Bosacki, Ambassador of the Sejm of the Republic of Poland.

Right now, there is a clear imbalance in Ukrainian-Polish economic cooperation.

There are 26,000 companies registered in Poland where at least one participant is Ukrainian, either an individual or a company. On the other hand, 2,000 Polish companies have already expressed their readiness to be involved in rebuilding Ukraine. This is completely logical: nearly a million Ukrainians fled to Poland to escape Russian aggression. Over the past three years, many of them have integrated into Polish society, with minimal language barriers and obvious cultural similarities.

These same factors should work in reverse: Polish businesses can and should become a driving force for foreign investment in Ukraine, as they understand the local context better and are more adaptable.

Currently, Poland ranks only tenth among investors in Ukraine, but if we exclude offshore jurisdictions, which show the largest volumes of investment, Polish businesses are already achieving strong results.

Even during the war, over $4 billion in foreign investments were made in Ukraine in 2023. By the end of 2024, this amount could increase by 20%. Polish investments in Ukraine total $780 million. Currently, 600 Polish companies are operating in Ukraine, and another 1,200 plan to start businesses once the active fighting ends.

Yes, starting a business in Ukraine now is risky, but those who do so first will reap the biggest rewards. I often discuss this with our Polish partners at international events and privately.

To strengthen our cooperation, we organized the Ukrainian-Polish meeting at the Via Carpatia forum. For me, it’s crucial that Ukraine and Poland unite not only in the face of a shared threat but also through business partnerships. After all, it's the future that brings us together, not the past, which often divides us.

Poles and Germans once had similarly complicated relations, but it was the economy that ultimately laid the foundation for strategic understanding between them.

The Polish newspaper Rzeczpospolita has already pointed out that Ukraine could become a "golden opportunity" for Polish business. Polish journalists have noted that Polish companies have remained in Ukraine despite Russian missiles and bombs, which is a sign of resilience and determination.

In 2023, the Polish company Fakro suffered losses of 30 million zlotys after a Russian drone strike hit its plant in Lviv. Despite this, the company didn’t close down and continues to expand, including by building new production lines. Similarly, Cersanit invested 20 million euros in Ukraine during the war and increased production by 20%. The Polish clothing retailer LPP, which had 100 stores in Ukraine before the invasion, planned to double that number by the end of 2024.

According to the latest data from the Polish Investment and Trade Agency, 3,022 companies have already expressed interest in participating in Ukraine's postwar reconstruction. Polish companies are especially keen on sectors like construction, food, healthcare, engineering, and IT.

And not all of them are waiting for the war to end. This fall, for the first time, Poland's Export Credit Agency insured a Polish company in Ukraine for $45 million. This insurance covers risks related to the consequences of hostilities, and this practice should be scaled up.

Putin will not succeed in dragging Ukraine back to the Stone Age, no matter how many missiles he fires at us. We have strong support from Europe as a whole, and Poland, as our main logistics hub, should also become a key investment partner. The goal of both Ukrainian and Polish politicians is to ensure that our future always outweighs the past.

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About the author. Mykola Kniazhytskyi, journalist, member of the Ukrainian parliament.

The editors don't always share the opinions expressed by the authors of blogs or columns.