The Export Credit Agency (ECA) has insured its second project against war risks. Its total amount is UAH 92 million. The project is being implemented by Vilis, a private enterprise that produces pasta and apple jam.

The company is investing half of the amount (UAH 52 million) with its own funds, and taking out an investment loan from Ukreximbank for another UAH 40 million.

The total cost of the project, which is being implemented by Vilis, includes the cost of new equipment (packaging and noodle production lines), its delivery and installation, construction of a boiler house, etc. The modernisation will allow the company to increase production to 4,000 tonnes per year, including by expanding its sales markets.

“This example of ECA insurance can be a good benchmark for the insurance market and an incentive to work more actively with investors who plan to invest in the development or creation of business in Ukraine. We understand that war risk insurance is not the only argument that can motivate investors to invest in Ukraine. But it is definitely a necessary tool to support our efforts to attract investment, especially when it is investment in the real sector that will stimulate the production of goods made in Ukraine,” said Yuliia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine.

The company currently produces about 10,000 tonnes of pasta and 800 tonnes of instant noodles, of which 486 tonnes of pasta and 100 tonnes of instant noodles are exported.

As a reminder, the possibility of insuring investments in the development of processing and export of goods against war risks is provided for in the amendments to the Law “On financial mechanisms for stimulating export activities”.

An investor (Ukrainian or foreign) may apply to the ECA and receive investment protection if:

• it owns more than 10% of corporate rights in the project;
• it invests in the creation of facilities or infrastructure for the development of processing and exports;
• the investment objects are located in Ukraine;
• the goods to be exported meet the requirements of the law on export promotion.

A bank providing funds for investment may insure its risks with the ECA if:

• the borrower is a resident of Ukraine;
• the loan is related to investments in facilities or infrastructure for the development of processing and export of goods (works, services) of Ukrainian origin;
• the facilities and infrastructure for which the investment loan is provided are located in Ukraine;
• the exported goods meet the requirements of the law on stimulating export activities.