BlackRock Backs Out of Ukraine Rebuild Fund Initiative
US multinational investment company BlackRock halted its search for investors for Ukraine’s reconstruction fund earlier this year after Donald Trump’s election win shifted the US stance towards Russia’s full-scale war.
People familiar with the matter told Bloomberg that the firm paused investor talks this January.
The fund, developed with backing from Germany, Italy, and Poland, was set for a formal launch at the Ukraine Recovery Conference in Rome on July 10-11, a high-stakes event dedicated to the recovery and reconstruction of Ukraine during and after Russia’s war.
BlackRock had worked on the plan for over a year and was nearing a deal with several institutional investors. However, in January, the US company decided to pause talks with institutional investors due to a lack of interest amid increased uncertainty over Ukraine’s future, Bloomberg wrote.
By late 2023, the Ukraine Development Fund had lined up at least $500 million in public-sector commitments and aimed to secure $2 billion in private capital. The total financing target for reconstruction work stood at $15 billion, BlackRock Vice Chairman Philipp Hildebrand said.
Russia’s full-scale war has caused an estimated $170 billion in direct damage to Ukraine’s infrastructure. In 2024, this amount increased by $12.6 billion due to further missile attacks and ongoing fighting, Kyiv post previously wrote, citing the Kyiv School of Economics (KSE) data.
The total cost of reconstruction and recovery after the full-scale war over the next decade will cost the Ukrainian economy $524 billion, the United Nations, in collaboration with the Ukrainian government, the World Bank Group, and the European Commission estimates showed.
The US didn’t join the fund’s backers in December 2024. After Trump’s election win, investor interest dropped. The new US president pledged to end the war through talks with Ukraine’s president Volodymyr Zelensky and Russia’s leader Volodymyr Putin but has since sent mixed signals and clashed with both.
BlackRock ended its advisory role in 2024 and no longer holds a Ukrainian mandate. A spokesperson told Bloomberg that the firm acts solely as directed by its clients.
France is now working on a replacement plan for the fund, but it may struggle without US support Bloomberg sources have said.
Meanwhile Trump’s envoy to Ukraine, Keith Kellogg, is planning to travel to Rome this week to meet Ukrainian President Volodymyr Zelensky and to attend the Ukraine Recovery Conference (URC) 2025.
Source: Kateryna Mykhailova