The law enters into force on January 1, 2024, a number of steps must be taken to launch the mechanism
The Verkhovna Rada has adopted Law No. 9015 on investment insurance against military risks. This was announced by the initiator of the law, Deputy Chairman of the Parliamentary Committee on Economic Development Dmytro Kysylevsky.
As the MP explained, the essence of the law is to give the Export Credit Agency of Ukraine (ECA) the right to insure investments against war risks.
«Such a policy will allow Ukrainian investors and industrialists to count on compensation for losses in the event of an “arrival”, he noted.
Kysylevsky reminded that currently only foreign companies can obtain such investment insurance policies against war risks through international financial institutions. After the law is signed by the President of Ukraine, domestic companies will also be able to obtain such policies through the ECA.
The law comes into force on January 1, 2024. By this time, the government, in consultation with the National Bank, must ensure the adoption of a relevant regulatory act defining the list of military risks, as well as the terms and procedure for insurance (reinsurance) of such risks in the implementation of ECA activities.
In addition, the MP notes, the necessary conditions for launching the mechanism are an increase in the authorized capital of the ESA and the establishment of reinsurance.
Dmytro Kysylevsky said that the Ministry of Economy is currently communicating with MIGA (Multilateral Investment Guarantee Agency), DFC (U.S. Corporation for International Development) and the EBRD, as well as with donors within the framework of the Multi-Donor Coordination Platform. The issue is the need to raise $100 million for reinsurance of the Ukrainian ECA and $500 million for international insurance and reinsurance trust funds. Also, together with the Ministry of Economy and the Ministry of Finance, the issue of increasing the authorized capital of the Export Credit Agency will be raised.
«The introduction of the mechanism of insurance of investments against war risks is part of the Plan for the recovery of the processing industry. It also includes incentives for industrial parks, the requirement of localization in public procurement, the return of industrial investments through taxes and other initiatives,» Kisylevsky summarized.
As GMK Center reported earlier, Ukraine is planning to attract international insurance companies for war risk insurance. The relevant declaration of intent to restart the private insurance market to support stability and reconstruction of the country was signed on the sidelines of the conference in London in June 2023.