E.U. plans to rebuild Ukraine’s economy

On October 25, European Union leaders gathered in Berlin to talk about establishing a platform for financial coordination to help Ukraine repair its economy, which has been hurt since the conflict with Russia started in February 2022. Olaf Scholz, the chancellor of Germany, compared the effort to revive the Ukrainian economy to the Marshall Plan, under which the United States helped to reconstruct the economies of European nations after World War II. In order for Ukraine to join the EU, the country’s economy must be rebuilt. EU membership might happen sooner if Ukraine receives assistance after the war.

According to the Associated Press, the E.U. is still figuring out how to pay for the reconstruction of Ukraine’s economy. Rebuilding Ukraine’s economy, according to Olaf Scholz, is “a generational task that must begin now,” despite the fact that the Russia-Ukraine War is still ongoing. Aid from other nations will probably be part of a financial coordination platform for reviving Ukraine’s economy. Ursula von der Leyen, president of the European Commission, reportedly stated, “Now is the time to bring the platform to action, together with the international donors.” and “The coordination platform that the global community has been discussing in recent months needs to get off to a running start as soon as possible.”

The World Bank assessed that $350 billion in damages have been caused since the start of the Russia-Ukraine War, whereas the Ukrainian government put that figure at $750 billion. But since the war started, Ukraine hasn’t gotten much aid, and it might be challenging for other nations to provide aid once it’s over. According to The Hill, the United States provided the majority of the $28.1 billion in financial, military, and humanitarian help to Ukraine. With $13.7 billion less in aid, the E.U. Although there has been support for aiding Ukraine, that support may decline if doing so results in a significant tax rise or if aid is not seen as being of any use to Ukraine. Additionally, the general rise in prices means that less money may be available to reconstruct the Ukrainian economy.

The cost of reviving Ukraine’s economy will be high. However, it might be simpler if more nations, such as all of the EU’s member states, the United States, and other G7 nations, support providing aid to Ukraine (Canada, Japan, and the U.K.). Each nation will have to make a smaller aid donation if more nations help Ukraine. As a result, sending aid to Ukraine will be more affordable for other nations, and if they all do so, there may be enough aid to properly reconstruct Ukraine’s economy.

Along with providing assistance, the Marshall Plan also boosted democratisation and economic progress in Europe, according to the Center for European Policy Analysis. If the EU and G7 assisted in Ukraine’s economic recovery, growth in the country’s agriculture and energy markets would probably result. Aid will also assist markets in integrating with Europe more fully. These benefits for Europe make it worthwhile for Ukraine to recover its economy, which may increase support for aiding Ukraine.

Ukraine submitted its application for EU membership in February 2022 and was recognised as a candidate in June. The Council on Foreign Relations claims that applicants often wait a long time to join the EU and that some nations have been contenders for between 10 and 20 years. Respect for democracy and a running market economy are requirements for E.U. membership. Ukraine could be able to achieve some of the economic criteria for membership if its economy is rebuilt. But according to the Washington Post, before Ukraine can join the EU, it must also permit elections for members of the Constitutional Court and restrict the power of the oligarchs who dominate the majority of the nation’s economy. This shows that even if Ukraine’s economy is restored, a lot more needs to happen before it can become a member of the EU.

The war with Russia has hurt Ukraine’s economy, and it will cost money to rebuild it. Many nations will need to help rebuild Ukraine’s economy after the war is over for the nation to get significant aid. In the event that this takes place, Ukraine will eventually be able to join the E.U. and develop into a more democratic nation with a market economy.