Tomi Taipale
Honorary Consul
of Lithuania
Turku Region
Finland
tomi.taipale@mamec.fi
Russia's two-year-long offensive war against Ukraine has caused significant damage every day. The greatest and irreplaceable harm is, of course, the war victims who have lost their lives. These sacrifices are priceless. The war also causes great mental suffering and trauma, which can hopefully be alleviated to some extent, but never completely eliminated. This burden will weigh on the hearts of Ukrainians for generations to come. The role of Western countries in the post-war period will be significant in the reconstruction of the country. The success of reconstruction will play a significant role in laying the foundation for Ukraine's future.
The
reconstruction of Ukraine is already underway, and mechanisms for its
implementation have been established and tested. Portals have been created
around existing projects that allow all interested actors to participate, and
project tenders are carried out among the participants who have registered
through these portals. The reconstruction has mainly focused on the immediate
infrastructure, such as the restoration of power plants, billions have
been spent on reconstruction so far, while post-war reconstruction is estimated
to cost between 500 and 1,000 billion euros, depending on the estimators. The
sum is enormous and will have various effects on the entire Western world. It
is already estimated that there will be a significant increase in the prices of
construction materials and steel, as well as significant inflation in Ukraine.
Before Russia's invasion of Ukraine in 2014, the population of Ukraine was approximately 45 million. Up to 12 million Ukrainians have had to flee from the war, of whom some, of course, have already returned to their homeland. It is believed that a significant portion of those who fled the war represent the Ukrainian middle class, and their role in the rebirth of Ukraine is significant. In order to make Ukraine as attractive as possible for those who have possibly lived abroad for a long time as war refugees, successful reconstruction should create a safe and high-quality environment for returnees. It is strongly emphasized in discussions that the rebuilt parts of Ukraine will represent future construction, where environmental values are taken into account in every aspect. I believe that pleasant garden cities will play a significant role in raising Ukraine to a new level after the war, and Finnish timber construction expertise could have a strong role to play in this model.
The Finnish government has been actively assisting companies interested in participating in the reconstruction. In November 2023, a delegation of over 40 Finnish companies participated in the Ukrainian reconstruction fair held in Warsaw. In December 2023, the Ministry of Foreign Affairs, together with other ministries and representatives of the business community, published Finland's national plan for participating in the reconstruction of Ukraine. The plan proposes solutions for financing and the development of advisory services. Small and medium-sized enterprises cannot be expected to embark on projects without strong support, which the government can provide. The effectiveness of financing models will play a crucial role in activating the Finnish business community in reconstruction.
Only a handful of Finnish companies have been actively operating in Ukraine, estimated to be less than 50. This creates the challenge that the market is very unfamiliar, and the local way of doing things needs to be learned. In this regard, the advisory services mentioned earlier play a significant role. I believe that if the markets are brought closer to the companies and made more accessible, the step towards initial transactions will be significantly easier.
I believe that Finnish companies will be seen in significant roles in the reconstruction of Ukraine. Finland has strong expertise, for example, in water treatment, energy production, and the aforementioned timber construction. Some of the cooperation will involve technology deliveries, normal bilateral trade, and potentially Finnish companies establishing themselves in the Ukrainian market. In the future, Ukraine will be an interesting market due to its size and potential future membership in the EU. EU membership or a strong probability of it will increase foreign investments in the country.
Ukraine as a society still suffers from corruption. It is possible and necessary to operate in the country without participating in corruption, but it remains part of social activities nonetheless. There have been some initial steps towards improving the situation, but corruption scandals are still frequent news in local media. If successful, reconstruction could be one way to create a corruption-free society. With the right tools, control of materials and financial flows could be done digitally and efficiently. Finnish companies could have a lot to offer in terms of this expertise.
The reconstruction of Ukraine will be an enormous task that will take years to accomplish. However, it will not begin on a larger scale until a ceasefire or peace is achieved in the country. I hope that day is near. Until then, we must provide all possible support to Ukraine in its fight against the tyrannical Russian regime.