Estonia will allocate €14 million annually to Ukraine for development as part of their cooperation. The relevant figures are outlined in the state budget strategy, as reported by ERR.
According to Mariin Ratnik, the Deputy Chancellor of the Estonian Ministry of Foreign Affairs, out of this amount, €12.8 million will be allocated to the Estonian Development Cooperation Center (ESTDEV), €1 million for humanitarian aid to Ukraine, and €200,000 to support cooperation between Estonian businesses and Ukraine. In the latter case, the focus is mainly on establishing business contacts with Ukrainian partners.
This assistance will be provided based on the long-term development cooperation strategy approved by the Estonian government in early January, as well as the principles and action plan for Ukraine's recovery.
Ratnik added that the government has specified the areas where Estonia's allocated funds can be most beneficial. "These are the sectors where we ourselves faced challenges in the past, as we emerged from the same society that Ukraine is trying to break free from: reforming the education system, developing the healthcare system, digital and cyber solutions," Ratnik said.
Additionally, Estonia is ready to provide various forms of assistance in the field of real construction that Ukraine needs. In addition to material support, Estonia will offer support to Ukraine in implementing new and more efficient systems and processes. As an example, Ratnik mentioned a kindergarten in Zhytomyr, built with innovative spatial solutions, the construction of which was accompanied by relevant training for educators and teachers.
Taking into account the commencement of negotiations regarding Ukraine's accession to the EU, Estonia will be able to share its own experience in this process, as well as in obtaining and utilizing subsidies from EU funds.
According to Klen Jäärats, the Executive Director of ESTDEV, the Estonian agency has earned a high reputation among major international partners, whose participation expands the financial possibilities of implemented projects. Additionally, ESTDEV is ready to work on-site, a readiness that is not present in all organizations with significant financial resources.
Ratnik emphasized that the post-war costs for the reconstruction of Ukraine are estimated at €400 billion, and such funds can only be allocated by major donors such as the World Bank, International Monetary Fund, European Bank for Reconstruction and Development, European Investment Bank, and others. "All these institutions do not implement projects independently but offer project financing, which can be applied for," explained Ratnik, emphasizing that Estonian companies can also participate in this process.
She added that this will also bring tax revenues to Estonia. "It is clear that supporting the functioning of the Ukrainian economy through entrepreneurship and cooperation between companies will be the factor that will reduce the future costs of all donors, including ours, for the recovery of Ukraine," said the Deputy Chancellor of the Estonian Ministry of Foreign Affairs.
The budget of ESTDEV in 2023 was €21.9 million. Ratnik and Jaerats noted that significant funds for development cooperation are also allocated to the Academy of Electronic Governance and non-profit organizations Mondo and Pagulasabi, the main part of whose funding comes from non-budgetary sources.
