Preparation of Resilient Projects to Advance Recovery of Ukraine (PREPARE Ukraine)

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Russia's invasion of Ukraine has inflicted a devastating toll on the country and Ukraine’s recovery, reconstruction, and operating needs are staggering. According to the Third Rapid Damage and Needs Assessment (RDNA3), produced by the Government of Ukraine (GoU), the World Bank Group, the European Commission, and the United Nations, as of December 2023 the estimated cost of Ukraine’s recovery and reconstruction stands at $486 billion over the next decade. Given Ukraine’s reconstruction and recovery needs and the investment gap, significant focus is required to ensure proper preparation of investment projects, efficient allocation of existing resources, and effective use of additional resources, including private investment, where possible. However, a lack of capacity and funding to quickly and effectively prepare implementation- and finance-ready projects that can effectively absorb resources has impeded recovery efforts. To date, the provision of funds and expertise for preparation has been managed bilaterally by each donor or International Financial Institution (IFI), and has not been based on a clear prioritization process by the GoU. To address these challenges, the GoU has established a Public Investment Management (PIM) roadmap, including the creation of the Strategic Investment Council (SIC) and Single Project Pipeline (SPP), to facilitate a more coordinated approach. In addition, the GoU has been working with IFIs and development partners on the development of an integrated Framework for Project Preparation for Ukraine (FPPU), which will coordinate project preparation across several Project Preparation Facilities (PPFs). This operation will develop, fund and operate one of those PPFs - the Ukraine PPF. Project components include:Component 1: Strengthening Institutional and Technical Capacity, the capacity of the GOU has been ravaged by Russia’s invasion of Ukraine, and the GOU will need help growing those skills and rebuilding its capacity, particularly after the invasion. This component will support capacity development for PPF stakeholders around the institutional and technical issues fundamental to the success of the PPF, including the governance and functioning of the Ukraine Government PPF as well as latest best practices on how to prepare infrastructure projects in different sectors.Component 2: Preparation of Priority Projects will fund preparation of projects from the SPP prioritized by the GOU as part of the PIM process and approved by the SIC. The Ukraine Government PPF team will interact closely with the PPU throughout the allocation process and review project preparation requests to identify needed technical assistance to prepare projects that are viable, environmentally and socially sustainable, and meet EU accession requirements in particular with regards to alignment with pan-European strategies, taking into account EU rules and standards, and following impact assessments framed by the acquis. It is expected that initial projects prepared under the PPF will be structured as public investment projects. In the post-war reconstruction phase, there is an intention that the PPF will consider the identification and preparation of projects under PPP modalities, dependent on the country’s macro-economic conditions and private sector appetite.Component 3: Project Management will fund the running of the Ukraine Government PPF core team, including management, administration, and operational functions, such as office costs, salaries of the core team consultants, project audits, travel and outreach to external stakeholders, meetings, events, workshops, etc.