The Ministry of Finance and the Polish development bank BGK discussed the possibility of implementing projects to support local communities in Ukraine

Deputy Minister of Finance of Ukraine Olga Zykova held a working meeting with a delegation of the Polish development bank BGK led by Director of the International Partnerships and Analysis Division of the Department of International Development Instruments Karol Tofil.

The meeting took place during BGK’s working visit to Kyiv and focused on the practical implementation of the Ukraine Facility instrument to support local communities and investment projects in Ukraine.

The parties discussed preparations for the launch of BGK’s full-scale operations in Ukraine following the ratification by the Verkhovna Rada and the signing by the President of Ukraine in March of the Agreement on the bank’s activities. The document grants BGK a status similar to international financial institutions, opening the way for large-scale operational work.

Olga Zykova thanked the Polish side for its consistent support for Ukraine: “The Government of Ukraine is pleased to begin productive cooperation between Ukraine and Poland in implementing projects that are critically important for the recovery of communities and improving people’s quality of life. BGK plays a special role as a financial bridge between our countries, combining resources, expertise, and the opportunities of European instruments for Ukraine’s reconstruction. I am confident that our cooperation will facilitate the rapid launch of practical projects, attract investment, and strengthen long-term Ukrainian-Polish partnership.”

In particular, the meeting focused on:

• opportunities for the bank to finance the recovery of critical municipal infrastructure, including water and heating systems;
• combining EU grants with BGK credit lines to reduce borrowing costs;
• mechanisms for guaranteeing local borrowing and practical aspects of their approval;
• preferential VAT treatment for projects financed through international technical assistance and foreign loans.

The parties also discussed approaches to implementing projects under the Ukraine Investment Framework, as well as financial support for local projects through Ukrainian state-owned banks with European Commission guarantee coverage.

Currently, two BGK framework projects for implementation in Ukraine have been approved under the Ukraine Investment Framework (UIF) with European Commission guarantees – in the private sector (investments in energy, transport, and construction of around EUR 200 million) and in the public sector (support for municipal infrastructure recovery worth EUR 20 million).

Following the meeting, the parties agreed to continue practical coordination and exchange of experience to ensure the effective implementation of joint initiatives and strengthen Ukrainian-Polish partnership in Ukraine’s reconstruction.