To Promote U.S. Investment in Ukraine’s Reconstruction, Appoint a Special Presidential Envoy to Coordinate U.S. Efforts

Commentary by Romina Bandura

Published December 18, 2024

This commentary is part of a report from the CSIS Global Development Department series entitled Global Development Recommendations for the Next Administration.

Three full years into Russia's full-scale war against Ukraine, the conflict has damaged Ukraine's economy and created immense human suffering. The Trump administration, jointly with Ukraine and Western allies, will likely have to help broker a political settlement to end the conflict while ensuring a long-lasting peace.

In October 2024, President Volodymyr Zelensky unveiled his Victory Plan to allies and the Ukrainian parliament. Beyond stronger security guarantees for Ukraine, the plan includes efforts for economic development and protection of the country's natural resources. Attracting significant private capital and aligning Ukraine to the West will be critical to stabilize the country, modernize the economy, and achieve a long-lasting peace. American companies can help make this vision a reality by providing financing, innovation, and technological know-how. In this regard, the Biden administration appointed Penny Pritzker as a special representative for Ukraine's economic recovery, housed in the U.S. State Department. Although her mandate was brief, one of her goals was to catalyze U.S. private sector investment into Ukraine.

Beyond foreign aid, the U.S. government has a set of instruments to attract companies to invest in Ukraine, including guarantees and political risk insurance, equity investments, direct loans, and enterprise funds. With a difficult global landscape in 2025, characterized by competing development challenges, geopolitical tensions, and dwindling foreign aid budgets, the U.S. International Development Finance Corporation (DFC) and commercial firms will play a more prominent role in financing investments in Ukraine.

The Idea

Under any expected settlement, the Trump administration can both support Ukraine in its rebuilding efforts and help U.S. business with billions of dollars in investment.

Ukraine will require significant funding to recover and rebuild from the devastation caused by the war. These efforts will involve billions of dollars and, if the next administration takes the necessary steps to actively manage this process, offer potential opportunities for U.S. business and investment. First, as president, Trump should appoint a special envoy to coordinate all U.S. assistance and ensure U.S. businesses have opportunities in Ukraine's reconstruction. Next, he should unleash the DFC to mobilize private investment, rather than direct assistance, to support Ukraine.

Under any expected settlement, the Trump administration can both support Ukraine in its rebuilding efforts and help U.S. business with billions of dollars in investment.

Given the magnitude of the reconstruction challenge and the lack of enthusiasm for employing foreign aid, funding to rebuild and modernize Ukraine will have to come from other sources, mainly private capital. Appointing a U.S. envoy that focuses on private sector investments into Ukraine would help the country rebuild and support U.S. businesses at the same time. With hundreds of American companies already operating in Ukraine, the United States can ramp up its business footprint. Even before the war, the United States was a top source of foreign direct investment into the country. American companies are leaders in many sectors, including transport and logistics, information technology, agribusiness, and defense. In addition, U.S. companies possess significant experience in supporting large-scale reconstruction efforts in very difficult environments, including in regions experiencing conflict (e.g., Afghanistan and Iraq).

A strong business sector is the key to Ukraine's future. The CSIS bipartisan and international Ukraine Economic Reconstruction Commission provided a policy framework to help attract private sector investments for Ukraine's modernization. Operationalizing this framework during peacetime includes Ukraine undertaking significant governance and economic reforms to improve its business environment, substantial funding for reconstruction projects, and greater donor coordination among the international community. In this regard, the incoming administration has an opportunity to advance American interests while focusing on the reconstruction and modernization of Ukraine.

Action Steps

President Trump should appoint a special envoy, someone the president trusts and who possesses the business acumen and significant experience needed to structure the investment projects required for long-term development in Ukraine. Ideally, the special envoy should be nestled in the DFC, which has the infrastructure and personnel to identify business opportunities and structure deals. This special envoy will also need to coordinate across U.S. government agencies that have deep experience in Ukraine matters, including the U.S. Agency for International Development (providing direct assistance), the EXIM Bank (supporting U.S. exports), and the U.S. Trade and Development Agency (conducting feasibility studies and project preparation capabilities).

The duties of the envoy would include the following:

• Coordinate U.S. and donor reconstruction assistance to Ukraine to make it efficient and prevent corruption.
• Promote U.S. investment in Ukraine reconstruction, with DFC in the lead.
• Strengthen Ukraine's economy to support its sovereignty and security under any expected political settlement.

The envoy would help catalyze U.S. investments as well as provide added accountability and transparency for tracking these investments. In September 2024, the Ukrainian government launched a single pipeline of projects through a digital platform that compiles and tracks public investment projects. In this regard, Ukraine will need partners such as the United States to catalyze investments to high-impact projects.

Moreover, the envoy can be more active in supporting U.S. investments in strategic sectors in Ukraine. The DFC, established during the first Trump administration, has the opportunity to turbocharge its operations in Ukraine. With the DFC's reauthorization in the works in 2025, the agency is set to double its credit ceiling from $60 billion to $120 billion. This gives room for the agency to increase its exposure in Ukraine, which currently stands at $1.6 billion. Strategic sectors that the DFC should target include decentralizing the energy system, supporting value-added agribusiness, modernizing transport and logistics infrastructure to integrate with the EU market, and expanding the digital and tech sectors. Although the DFC does not finance projects within the defense industrial complex, it could reconsider this policy given the mandate in Ukraine to enhance the country's defense and security and the comparative advantage that American companies possess in this field.

Finally, there are key reforms that Ukraine needs to undertake to attract foreign direct investment and align laws and institutions with EU candidacy requirements. The United States should support this process so that Ukraine generates the right conditions for new businesses, including American companies, to invest in the country.

Romina Bandura is a senior fellow with the Project on Prosperity and Development at the Center for Strategic and International Studies (CSIS) in Washington, D.C.

Programs & Projects