The Verkhovna Rada has passed Law No. 9015 on investment insurance against war risks. It entitles the Export Credit Agency of Ukraine to insure investments against war risks. Such a policy will allow Ukrainian investors and industrialists to count on compensation for losses in the event of a hit. This was reported by the initiator of the law, MP Dmytro Kysylevskyy.
"Currently, only foreign companies can obtain such investment insurance policies against war risks through international financial organisations. After the law is signed by the President, Ukrainian companies will also be able to obtain such policies through the ECA," the MP explained.
The law comes into force on 1 January 2024. The Cabinet of Ministers must ensure the adoption of a regulatory act in agreement with the National Bank of Ukraine that defines the list of military risks, as well as the terms and procedure for insurance (reinsurance) of such risks in the course of the ECA's activities.
A prerequisite for the launch of investment insurance against war risks is an increase in the authorised capital of the ECA and the establishment of reinsurance. Without this, the mechanism will not work.
Dmytro Kysylevskyy also said that the Ministry of Economy is currently communicating with MIGA, DFC and the EBRD, as well as with donors within the framework of the Multi-Donor Coordination Platform, on the need to raise $100 million for reinsurance of the Ukrainian ECA and $500 million for international insurance and reinsurance trust funds.
The introduction of a mechanism for insuring investments against war risks is part of the Manufacturing Recovery Plan. It also includes incentives for industrial parks, localisation requirements for public procurement, return on industrial investment through taxes, and other initiatives.