Nordic support for Ukraine: Unified commitment to Ukraine’s recovery

July 5, 2024

The Nordic countries - in particular, Sweden, Finland, Denmark, and Norway - have collectively demonstrated strong support for Ukraine in its struggle against Russian aggression. Their approaches, while varied, converge on key themes of economic aid, military assistance, diplomatic backing, and humanitarian support. This unified stance underscores the Nordics' commitment to Ukraine's sovereignty, resilience, and long-term development.

The latest affirmation of this support comes from Norway's recent pledge of an additional €5.6 million to the International Chernobyl Cooperation Account (ICCA), contributing to enhanced safety measures for spent nuclear fuel storage and liquid radioactive waste management at the plant. The ICCA, established in 2020, initially aimed to develop a comprehensive plan for Chornobyl, but its scope expanded after Russia's occupation of the exclusion zone, now encompassing broader nuclear safety efforts across Ukraine.

Below we summarize some of the key initiatives undertaken by Sweden, Finland, Denmark, and Norway.

Sweden

Sweden has been a steadfast supporter of Ukraine throughout the war with Russia. As the war continues, Sweden's role has expanded significantly, particularly in terms of economic support and investment in Ukraine's recovery and development.

Diplomatic and military support

Sweden has provided comprehensive support, including military aid packages, participation in peace summits, and the recent security agreement. Sweden's diplomatic backing has been crucial in rallying international support and increasing sanctions against Russia.

Economic investment and business engagement

A significant milestone in Swedish-Ukrainian economic relations was the opening of Business Sweden's representative office in Kyiv on June 24, 2024. This office aims to facilitate Swedish business operations and investments in Ukraine, signifying a long-term commitment to Ukraine's economic revival. Business Sweden, known for its global reach, supports Swedish companies in over 40 international markets and now extends its expertise to Ukraine.

Reconstruction and sectoral investment

Sweden's involvement extends to the reconstruction of war-affected regions. President Zelenskyy has invited Swedish businesses to take patronage over specific areas needing redevelopment, a move that underscores the collaborative spirit between the two nations. Prime Minister Denys Shmyhal has highlighted key sectors ripe for investment, including energy, transport and logistics, agri-food, critical materials, IT and digitalization, green transition, and manufacturing.

Support for the energy sector

Energy support remains a critical component of Sweden's aid. The Swedish government has committed to bolstering Ukraine's energy sector over the next three years. This includes investments aimed at increasing energy security and independence from Russian energy supplies. Sweden is also focusing on high-tech industries, telecommunications, and cybersecurity, sectors vital for Ukraine's modernization and defense.

War risk insurance and export credit

To mitigate the risks associated with investing in a war zone, the Swedish Export Credit Agency is providing war risk insurance. This measure is designed to protect Swedish investors, encouraging them to engage more deeply with the Ukrainian market despite the ongoing conflict.

Finland

Finland has demonstrated a clear commitment to supporting Ukraine through significant economic aid, strategic investments, and robust diplomatic efforts. Finland's approach aims at long-term recovery and development, bolstering Ukraine's resilience and fostering economic stability during and after the war.

Diplomatic and humanitarian support

Finland's diplomatic endeavors have been crucial in rallying international support for Ukraine. Finnish officials have consistently advocated for Ukraine in international forums, emphasizing the necessity of sustained economic and humanitarian assistance.

Economic investment and business engagement

A landmark development in Finnish-Ukrainian relations is the establishment of a joint office in Kyiv by the Confederation of Finnish Industries (EK) and the Chamber of Commerce and Industry EastCham. This office is designed to assist Finnish companies in engaging with Ukraine's reconstruction projects and entering the Ukrainian market. The Kyiv office will serve as a vital resource, offering Finnish companies valuable information about the Ukrainian market and business environment. It will help identify local partners, provide insights into funding and reconstruction projects, and maintain a dialogue with the Ukrainian government.

Infrastructure and energy investment

Finland has targeted key sectors for investment, particularly those that enhance Ukraine's critical infrastructure. Finnish companies are encouraged to invest in areas such as energy, telecommunications, water and waste management, and health technology.

The energy sector is a focal point of Finland's support. Finnish investments aim to strengthen Ukraine's energy infrastructure, promoting energy independence and security. This includes modernizing facilities and supporting renewable energy projects.

War risk insurance

To encourage Finnish businesses to invest in Ukraine, Finland has introduced measures such as war risk insurance. This initiative provides financial protection to Finnish investors, reducing the risks associated with operating in a war-torn region and boosting investor confidence.

Reconstruction and long-term development

Finland's involvement in Ukraine's reconstruction is significant. Finnish businesses are invited to participate in rebuilding efforts, focusing on sustainable development and job creation. The Finnish government's national plan for Ukraine's reconstruction, formulated in collaboration with business stakeholders, emphasizes financing and advisory services to facilitate active Finnish participation.

Denmark

Denmark has been a staunch supporter of Ukraine, offering substantial economic assistance, investing in critical sectors, and actively participating in diplomatic efforts. Denmark's approach emphasizes long-term recovery and development.

Diplomatic and military support

Denmark has played a crucial role in advocating for Ukraine's sovereignty and territorial integrity. Danish leaders have consistently supported Ukraine in diplomatic forums, pushing for increased sanctions against Russia and promoting peace initiatives. Denmark's military aid and participation in joint military exercises underscore its commitment to Ukraine's defense.

Economic investment and business engagement

Denmark has prioritized economic partnerships with Ukraine, focusing on sectors such as energy, agriculture, IT, and green technologies. Danish businesses are encouraged to invest in Ukraine, with initiatives aimed at fostering sustainable development and creating job opportunities.

Over 100 Danish companies currently conduct business in Ukraine. The Danish Export Investment Fund (EIFO) provides full risk coverage for Danish exporters investing in Ukraine, including risk mitigation during construction or production as part of export contracts. Private Danish companies also benefit from risk capital backed by Danish financial institutions, enabling investments worth nearly €140 million. Additionally, Denmark's fund for Ukraine has allocated approximately €15 million to support the recovery of Ukraine's economy through private sector initiatives, with the Investment Fund for Developing Countries (IFU) playing a crucial role in this endeavor.

Support for energy and infrastructure

Denmark's expertise in renewable energy and sustainable infrastructure aligns with Ukraine's goals for energy independence and modernization. Danish investments in energy projects aim to enhance Ukraine's energy security and efficiency, reducing dependence on Russian energy sources.

Financial aid and reconstruction efforts

Denmark has contributed financial aid to Ukraine's reconstruction efforts, supporting projects that rebuild critical infrastructure, hospitals, schools, and public services. Danish funding initiatives are designed to facilitate economic recovery and sustainable growth, laying the foundation for Ukraine's long-term development.

Norway

Norway has emerged as a stalwart supporter of Ukraine, committing substantial resources to bolster Ukraine's energy security and overall resilience. Since the full-scale invasion began, Norway has significantly ramped up its support efforts, exemplified by its recent commitment of NOK 1.1 billion to reinforce Ukraine's electricity infrastructure.

Electricity infrastructure support

Norway's latest contribution focuses on securing Ukraine's electricity grid, which has been severely compromised by Russian attacks on critical infrastructure. This funding, channeled through the Nansen Support Programme, aims to repair and maintain essential energy facilities, crucial for sustaining basic services like hospitals in the Kharkiv region.

Strategic dialogue and long-term commitment

Under the Nansen Support Programme, Norway has pledged NOK 75 billion over five years (2023-2027) for civilian and military aid. This sustained funding reflects Norway's proactive stance in addressing Ukraine's urgent needs, encompassing energy security, humanitarian relief, and broader infrastructure rehabilitation efforts.

Nuclear safety and international collaboration

Recognizing the interconnected challenges of energy security and nuclear safety in conflict zones, Norway has collaborated closely with international bodies like the IAEA to safeguard Ukraine's nuclear facilities. This collaboration is vital amidst repeated disruptions to power supply at nuclear plants, underscoring Norway's comprehensive approach to mitigating risks of radioactive incidents.

Strategic defense support

Beyond humanitarian aid, Norway has earmarked significant resources for Ukraine's defense capabilities, particularly in bolstering air defense systems. This includes substantial investments in military equipment and strategic consultations to enhance Ukraine's resilience against aerial threats, reflecting Norway's commitment to supporting Ukraine's defense posture.