The governments of Ukraine and Germany discussed attracting support for SMEs within the framework of the Business Development Fund

In the framework of the Ukraine Recovery Conference - URC2024, representatives of the Ministry of Finance of Ukraine, the Business Development Fund, KfW and the German Government discussed mechanisms to support small and medium-sized businesses in Ukraine, in particular within the framework of the BDF.

The discussions also focused on the institutional development of the Business Development Fund to transform it into a full-fledged National Development Institution to support the financing of small and medium-sized enterprises in Ukraine.

"We are grateful to the Government of Germany and KfW for supportingthe efforts of the Ministry of Finance in the further development of the BDF. We are currently actively working to transform the Fund into a sustainable, reliable and independent institution. This is a necessary step in order to achieve decent results in the development of business in Ukraine, the recovery and resilience of the Ukrainian economy, as well as the overall institutional transformation and European integration of Ukraine. Since the beginning of 2022, the Ministry of Finance, together with the BDF, has developed and implemented a number of new projects and programs to support SME financing totaling almost EUR 800 million," Deputy Minister of Finance Olga Zykova said in her speech.  

One of the most notable examples is the State Program "Affordable Loans 5-7-9%" supported by KfW, which, according to experts, has provided about 90% of business loans since the beginning of the full-scale war.

Thus, the World Bank, the IMF, GIZ, the Japan International Cooperation Agency (JICA), then Luxembourg Development Cooperation Agency (LuxDev) and other international institutions have repeatedly noted the Fund's activities and the importance of its further development. The Ministry of Finance aims to expand cooperation by attracting new donors to support the development of the Fund.

"We have chosen the model of the German Development Bank KfW as an example for the new institutional model of the DFG. The DF is ideally suited to this model, as it was jointly developed and laid the foundation for the Fund's activities back in 1999, and in its essence, the DF carries the basic ideology and features of the KfW model”, Executive Director of the Business Development Fund (BDF) Andriy Gapon.

The consulting company Deloitte was engaged for the implementation of measures for the institutional development of the BDF, with which a contract was signed on the eve of URC2024.