The seven months that have elapsed since our last update in June 2023 have been tumultuous ones for Ukraine on and off the battlefield. Russia’s continued bombardment of civilian infrastructure means that the total estimated cost of Restoration in Ukraine has increased to USD 486 billion over the next decade, and is likely to increase further.
Despite severe funding limitations, Restoration started to gain some momentum and became the defining civilian focus of Ukraine’s Government and the donor community. Energy, water supply, housing and transport infrastructure have been central concerns of Ukraine’s infrastructure-related agencies.
The continuous Restoration of this infrastructure has been – and will continue to be – critical to Ukraine’s remarkably vibrant economic and social life even during wartime.
During the second half of 2023, the main funding vehicle for Restoration projects was the Fund for Remediation of the Consequences of the Armed Aggression. This “Remediation Fund” selected more than 300 Restoration projects over successive project competition rounds. A total of UAH 58.2 billion (approximately CHF 1.33 billion) was allocated to various Ministries and Agencies.
Among many worthy projects, this included the construction of protections for 22 electricity substations and 63 substation components solid enough to withstand hits from drones and shell fragments.
This document takes stock of recent progress (July 2023 to February 2024) in strengthening Ukraine’s anti-corruption ecosystem with a view to safeguarding Restoration projects. It covers:
- Progress in enforcement, with the exposure of three corruption cases.
- Mitigating corruption risks in the Remediation Fund and other Restoration funding mechanisms, including prioritisation, project selection and budget allocation.
- Increasing Restoration project transparency through the DREAM system.
- Connecting Restoration projects with wider strategic planning.
- Strengthening auditing oversight over the Restoration process.
- Development of the public procurement system, including by increasing the share of competitive procurement, making direct contracts more transparent, and strengthening audits and controls.
It is a joint publication of Transparency International Ukraine and the Basel Institute on Governance. A forthcoming sister publication will provide an overview of anti-corruption progress and gaps not directly related to the Restoration.
Despite severe funding limitations, Restoration started to gain some momentum and became the defining civilian focus of Ukraine’s Government and the donor community. Energy, water supply, housing and transport infrastructure have been central concerns of Ukraine’s infrastructure-related agencies.
