IFC Unveils New Investments to Bolster Ukraine’s Private Sector Recovery

As Ukraine continues its long road to recovery from the devastating effects of Russia’s full-scale invasion, the International Finance Corporation (IFC), a member of the World Bank Group, has announced a bold set of initiatives aimed at reinvigorating Ukraine’s private sector, boosting energy security, and driving innovation. Launched during the 2025 Ukraine Recovery Conference, the package of investments is part of a broader push by international partners to accelerate reconstruction and economic resilience as Ukraine edges closer to EU accession.

Private Sector: The Engine of Recovery

Despite immense challenges—including security threats, labor shortages, and soaring input costs—Ukraine’s private sector has remained remarkably resilient. As of May 2025, nearly two-thirds of businesses are operating at full or near-full capacity. However, to fully recover and reach sustainable growth, Ukraine will require significant private investment, productivity improvements, and strong structural reforms.

“Ukraine’s private sector has shown extraordinary resilience, and with the right reforms, its economic potential is immense,” said Alfonso Garcia Mora, IFC’s Regional Vice President for Europe, Latin America, and the Caribbean. “IFC remains firmly committed to supporting Ukraine’s recovery by mobilizing private capital, driving innovation, and advancing the country’s path toward EU accession.”

Venture Capital Takes Root: €5M for Ukraine’s First Institutional VC Fund

One of the key announcements was IFC’s equity investment of up to €5 million in Flyer One Ventures Fund V, Ukraine’s first institutionally backed early-stage venture capital fund. The European Bank for Reconstruction and Development (EBRD) is contributing an additional €6.5 million, while Japan is supporting the effort through IFC’s Economic Resilience Action (ERA) Program, with up to $3 million.

The fund will target Ukrainian startups in enterprise software, EdTech, FinTech, and consumer tech, marking a major step in building Ukraine’s venture capital ecosystem, retaining local talent, and attracting global capital to Ukraine’s innovation economy.

Private Equity Push: Mobilizing €600M for Growth

In tandem with the EBRD, IFC is also preparing investments in private equity funds led by Ukrainian managers. These funds aim to raise over €600 million across infrastructure, private equity, and venture capital segments. By fostering investable funds that can modernize industries and improve services, these efforts send a powerful signal to international investors about the viability and long-term potential of Ukraine’s economy.

€105M Equity Guarantee from European Commission

In a further demonstration of global solidarity, IFC and the European Commission (EC) announced plans to finalize a €105 million Better Futures Program (BFP): High Impact Equity Guarantee Program, which will de-risk quasi-equity and equity investments in funds and direct ventures. Accompanied by €17.5 million in technical assistance, the guarantee could unlock over €1 billion in total private investment, amplifying impact in sectors crucial to Ukraine’s recovery.

This follows the €350 million BFP guarantee introduced at the 2024 Recovery Conference and forms part of the EC's broader support to enhance investment conditions in conflict-affected but reform-committed economies like Ukraine.

Green Energy for a Resilient Future

Ukraine’s energy infrastructure remains a critical weak point due to extensive war-related damage. To address growing power needs, IFC is evaluating a new investment in OKKO Group’s second onshore wind power project, following its €60 million investment in the company’s first 147MW wind project.

The initiative, still under due diligence, reflects IFC’s broader strategy to support green recovery, promote energy independence, and reduce carbon emissions, aligning with both Ukraine’s and the EU’s long-term climate goals.

Empowering Women in Energy: Power Women Ukraine

To tackle labor shortages in the energy sector and promote gender inclusion, IFC—alongside Scatec, FMO, Swedfund, and Ukraine’s Ministry of Economy—launched Power Women Ukraine, a hybrid training initiative for women. Set to begin in Kyiv in August, the program offers training in green energy, leadership development, and internships, preparing women to take on roles in Ukraine’s emerging energy transition.

$2.4 Billion Delivered by IFC Since 2022

IFC’s new commitments build upon its existing portfolio of $2.4 billion in support for Ukraine’s private sector since February 2022, including $908 million in mobilized finance. This effort falls under the Economic Resilience Action (ERA) Program, IFC’s comprehensive operational framework to stabilize and rebuild private enterprise under wartime conditions.

The ERA Program combines IFC’s own risk capital, blended finance, and technical advisory to help Ukrainian companies adapt, grow, and continue operating despite the conflict.

MIGA's Role: De-Risking Ukraine’s Recovery

The World Bank’s Multilateral Investment Guarantee Agency (MIGA) has also played a vital role. Since 2022, MIGA has issued $448 million in guarantees, with €185 million in new guarantees announced during the Recovery Conference to support financial sector resilience and improve access to finance for SMEs. These instruments are crucial in attracting foreign capital to high-risk environments by providing political risk insurance and credit enhancement.

World Bank Group: $78B and Counting

The World Bank Group has committed over $78 billion in support for Ukraine since the beginning of Russia’s invasion, assisting more than 20 million Ukrainians. The assistance spans direct budget support, infrastructure repair, education and health services, and the maintenance of government operations, including paying wages and restoring critical infrastructure.

A Vision for Recovery and Resilience

Through these initiatives, the IFC, along with its partners, is reinforcing the message that Ukraine’s recovery will be private sector–led, climate-conscious, and socially inclusive. These efforts not only provide critical short-term relief but also lay the foundations for sustainable, EU-ready development anchored in innovation, investment, and equity.