Ukraine reconstruction efforts challenged by lack of precedent

{"text":[[{"start":7.78,"text":"Agriculture is serious business for Ukraine, even more so since Russia’s full-scale 2022 invasion."}],[{"start":16.92,"text":"At that point, it accounted for around 10 per cent of GDP, nearly 15 per cent of its workforce — and two-fifths of exports, according to EU estimates."}],[{"start":31.71,"text":"Since then the war-torn country has become even more reliant on those exports — particularly grains and sunflower oil — as the invasion grinds on."}],[{"start":44.04,"text":"Ensuring they can reach foreign markets, however, has required some rapid and creative thinking, from agrifood businesses and from lawyers. The Black Sea route is all but blocked off, for instance, after Russia pulled out of an agreement that allowed shipments of grain to be exported from Ukrainian ports in July 2023."}],[{"start":67.68,"text":"“Ukraine is an agricultural country so it is important for us to sell as [many] agricultural products as possible, because our income as a country depends on [it],” says Anzhelika Livitska, partner at Ukrainian law firm Arzinger."}],[{"start":null,"text":"

It is important for us to sell as many agricultural products as possible, because our income as a country depends on it

"}],[{"start":86.28,"text":"Livitska led a team of lawyers who worked on construction and environmental law to help deliver one of Ukraine’s first and biggest “dry ports” — inland transport hubs that handle cargo for import and export."}],[{"start":103.68,"text":"Located near the Polish border, it has storage capacity for up to 6,000 tons of bulk cargo. Agricultural products will make up most of this, but there are facilities for other commodities too. The whole project took around two years and received €10mn financing from the European Bank for Reconstruction and Development. “The project will give capacity . . . for lots of Ukrainian agricultural enterprises to send products to Europe,” Livitska says."}],[{"start":138.97,"text":"To develop the dry port, Arzinger worked on aligning cross-border standards on anything from energy supply to environmental rules. One key task was working with Ukrainian Railways to ensure the most efficient physical transfer of freight between Ukraine and the EU."}],[{"start":null,"text":"

Logistics forced innovations because all the usual ways were not available or were very risky

"}],[{"start":160.05,"text":"Lawyers have had a natural role in Ukraine’s efforts to attract foreign investment and build major infrastructure since 2022. Much of the work involves tasks such as streamlining byzantine permitting systems."}],[{"start":178.39000000000001,"text":"Galyna Zagorodniuk, partner at law firm Imagine Lawyers, founded in 2024 by former DLA Piper colleagues, led a team that worked on a €35mn, 50 megawatt battery energy storage system, one of a number planned to help to stabilise the country’s grid."}],[{"start":199.03000000000003,"text":"Lawyers generally are tackling projects with little precedent in Ukraine for working within martial laws, she says."}],[{"start":null,"text":""}],[{"start":208.17000000000002,"text":"On the battery project, she adds: “Logistics forced innovations because all the usual ways were not available or were very risky.”"}],[{"start":219.01000000000002,"text":"Currency control, which became stricter with the onset of the full-scale war, is also a challenge, she says, for any projects requiring costly capital imports, because of restrictions on advance payments for equipment that would not be supplied within six months."}],[{"start":239.59000000000003,"text":"The timescale limited the ability to take delivery of complex battery equipment. The answer that Imagine helped devise, she says, was for a US company to buy the equipment and sell that to its Ukrainian subsidiary."}],[{"start":null,"text":"

The level of understanding . . . with an international angle for them is terra incognita

"}],[{"start":256.57000000000005,"text":"Separate contracts were made with the manufacturer for warranties and follow-up support."}],[{"start":262.9200000000001,"text":"Another challenge for legal advisers and their clients is that foreign donors need oversight when supporting projects in the country. Maksym Maksymenko, partner at law firm Avellum, led a team that structured a framework for US-based charity Sunflower Network to finance a modular-built hospital in western Ukraine. Scheduled for construction next year, it could prove a blueprint for other healthcare facilities."}],[{"start":295.00000000000006,"text":"Finding the right balance between donor oversight and the input of Ukrainian authorities took many attempts."}],[{"start":303.70000000000005,"text":"“We began with three options then another three options — then all of these options were put in a rubbish basket and from scratch we created a new one looking at parties’ needs and the final result,” Maksymenko says. Ten different parties were already involved in the project at this point. "}],[{"start":null,"text":"

We lose time and resources to fragmentation

"}],[{"start":326.19000000000005,"text":"The work involved improving understanding among local officials of what a big international donor requires. “The level of understanding . . . with [an] international angle for them is terra incognita,” he says."}],[{"start":345.34000000000003,"text":"Valeriia Ivanova, visiting senior fellow at the German Marshall Fund, a US think-tank, says Ukraine needs one single approach to reconstruction so that lawyers spend less time formulating new frameworks in an ad hoc manner. “We lose time and resources to fragmentation,” says Ivanova, a former civil servant."}],[{"start":null,"text":"

Everyone is sure that Ukraine will prepare for the next war

"}],[{"start":369.48,"text":"Whatever happens, the lawyers say it is important that projects are resilient against an uncertain future. That includes adding or strengthening measures relating to questions such as maintaining access to foreign financial support or underwriting of risk, for instance."}],[{"start":388.26,"text":"“Projects of this type are expected to last for years and we have such a strange neighbour as Russia [that] we cannot count on a peace deal even if it is reached,” says Zagorodniuk."}],[{"start":401.5,"text":"“Everyone is sure that Ukraine will prepare for the next war.”"}],[{"start":415.60999999999996,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1758267905_7560.mp3"}