Committee on Foreign Affairs Ordinary meeting
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AFET European Parliament
Follow its sittingsMykola Nazarov
It's moving along a spectrum from active war to possible reduced hostilities and long-term managed insecurity. That is why the Marshall Plan analogy is misleading. Ukraine is a candidate country fighting a war, dependent on a multi-donor architecture and preparing for EU membership at the same time. Please next slide. Core diagnosis.
The study identifies three structural misalignments. First, donors and investors focus on commercially attractive sectors, while non-investable basics remain underfunded. Second, demographic assumptions are often too optimistic in the case of Ukraine.
Infrastructure built for a population that doesn't return becomes stranded expenditure. So we still have no idea how many Ukrainian citizens will repatriate. So it's extremely challenge for Ukrainian government to plan reconstruction because of this human dimension. Third, reconstruction and accession are formally aligned but operationally separated. The consequence is clear: money alone is insufficient.
We think it's important for the Parliament to focus on allocation rules, demographic realism, and project-level EU compatibility. Next slide, please.
We suggest treating the RDNA5 as a floor. It doesn't fully quantify the project-level modernization premium of building immediately to EU standards.
It also doesn't fully price environmental liability such as flooded mines, contaminated groundwater, and it cannot provide a final cost for current occupied territories. If significant occupied territories are recovered, the total cost could approach or exceed 1 trillion euro. We therefore suggest that Parliament request the Commission to publish a sector-by-sector methodology for EU acquis-related costs and ensure the future financing does not treat 507 billion as a ceiling. Next slide. Financial taxonomy.
The practical financing recommendation is a taxonomy.
Non-investable basics such as rubble clearance, asbestos processing, mine dewatering, water systems, environment remediation, residential demining require public grants. Strategic public goods such as decentralized energy, trans-European transport network, TEN-T corridors and EU standards housing require concessional loans, EU grants and technical assistance. Please next slide. Demography and security is a great challenge for post-war Ukraine.
Demography is a central planning constraint. Refugee return intentions declined from 74% in 2023 to 43% by late 2025. Around 400,000 working-age men have been wounded and the veteran and dependent population may reach 4 to 5 million. Ukraine's population could fall to about 25 million by 2051.
This means large housing and social infrastructure projects should be preceded by demographic assessments. Return policy should move from temporary protection toward voluntary return facilitation only when security, jobs, schools, health services, and local capacities exist in exact territory. Security guarantees are therefore not only military tools. They are reconstruction instruments because they determine whether private investment and population return become rational. Next slide.
Ukraine is already has real accountability infrastructure. Digital restoration ecosystem for accountable management, DREAM, Prozorro, National Anti-Corruption Bureau, Specialized Anti-Corruption Prosecutor Office, the Accounting Chamber, and civil society monitoring. The weakness is not institutional, but rather distributional.
The places with the highest security and corruption risk often have the weakest local administrative capacity. The strategic recommendation is to use DREAM as a platform not only for transparency, but as an entry point for EU standards compatibility review. This should begin with large strategic investments in energy, transport, housing, and utilities, and then expand as capacity develops. And last slide, please.
Let me conclude with the complete action agenda. First, we suggest that Parliament request a published financial taxonomy and reinvents public grants for non-investable basics. Second, we recommend that Parliament require a methodology for the modernization premium so that EU acquis-related costs are financed from the outset.
Third, we suggest making DREAM and public investment selection to an entry point for EU standards review. Fourth, we recommend that Parliament require demographic assessment and a return facilitation framework linked to security and services.
Fifth, we recommend that Parliament strengthen the Verkhovna Rada's real oversight capacity through budget leverage, democracy support, and inter-peers. Sixth, we suggest that Parliament request a credible Commission delivery plan for the Ukraine Reserve and establish annual AFET evidence sessions with Ukrainian research institutions timed with the RDNA cycle. Seventh, we suggest that Parliament commission a mapping of economic benefits for EU member states and support regional twinning between Ukrainian oblasts and EU regions.
And finally, we recommend framing Ukraine not only as a candidate country, but as a cornerstone of Europe's future defense architecture. Reconstruction financing is therefore not only aid. It's accession preparation and strategic deterrence. Parliament has leverage across all three. Thank you for your attention.
Thank you, Mr. Nazarov, for the presentation. We now have time for an exchange of views until quarter past five. The coordinators are first, Michael Gahler.
Michael Gahler
Yes, thank you very much for this study.
And as I am the Ukraine rapporteur, also rest assured I will take due note of it, of the facts that you established, the figures. And of course, there are many estimates because you cannot be precise on forecasts, on prospects where we don't know, for instance, how many people will return. We don't know how long this dreadful war will carry on. So we, the figures are of course provisional and estimates, but it is very, very valuable to have them. That's about the figures.
Then it's about the challenges that you rightly described when we don't know how many people return, for instance. But if a road or whatever infrastructure has to be rebuilt, a bridge has to be built, whether there are 25 or 35 million Ukrainians, of course, so that will probably not make the big difference. I mean, what is clear, I think, in my mind, and in so far, I think we should also have a look on a specific issue. It is clear that not everything can be paid by the current income that they have as tax.
It can also not be paid by all the partners from outside, but the largest part of reconstruction after this war will have to be paid by the citizens themselves. And then I wonder whether you checked also mechanisms how to address the fact that there are people in the country who have not lost anything in the war and who even perhaps profited from it, and there are those who lost everything and who are perhaps even currently abroad.
And how to settle this issue in a way that there is a balancing mechanism amongst citizens. I mean, I'm from Germany, we had what we called a Lastenausgleichsgesetz, a burden-sharing law after the war, where those who had not lost anything paid higher taxes and those who had lost everything got cheap credits to settle again and so on. I haven't heard that they have thought of such a mechanism, but I think it's really due to have to develop something like that because otherwise many people will feel improperly treated. Because as I said, not every private house that has been destroyed can be reconstructed by state money. And so it has to come from the citizens.
So have you investigated a mechanism like that?
By the way, in Germany it took half a century till we ended this mechanism. And the KfW, which which is the the the now today the big lending bank for things like reconstruction, they are that is one of the childs of this mechanism and still existing although it has other tasks today. So would that be a way for Ukraine to to check how to be able to to address this huge financial challenge of reconstruction? Thank you.
Thank you. Next, Thijs.
Thijs Reuten
Thank you very much, Chair, and thank you for the presentation.
I will look at the report with great interest like my colleague, also responsible for Ukraine in our group, in the S&D group. What I like is you started with reconstructing while fighting. That also has been our point. It's a signal to the aggressor because it's not going to happen. You will not have it.
We will reconstruct it whatever you destroy even when fighting. Very good point. I'm interested in your return intentions findings because I'm very interested in how you came to them. A question.
What exactly do you mean with the action regarding the US-Ukraine reconstruction fund? Because I'm personally not really inclined to leverage some kind of EU acquis things reforms in favor of a fund which is a US-Ukraine fund, but maybe that was not what you meant, so can you maybe clarify that? And your point on regarding Ukraine as a defense asset. Well, we already did that. It's in the report that will be adopted in July and we are consistently delivering that message.
Ukraine is a security provider, will be a security provider to Europe and is an indispensable part of our security architecture in the future. The only problem is we have 27 capitals in this European Union that also have to understand that in full. Last point, chair, with permission, is a small address to the viewers at home because we are public again and I want to underline that yes, it's good that we have this research about peacetime and so on, but all this talk about peace and negotiations and reconstruction sometimes gives the wrong impression.
It's not over yet, and it will only come to genuine peace negotiations when we, because Ukraine wants that, the EU wants that, it will only come to that point when we exert the right amount of pressure on Putin and when we have the right amount of strength by providing Ukraine with what it needs to defend. Thank you.
Thank you. Who's next? Arkadiusz Mularczyk.
Arkadiusz Mularczyk
Thank you very much.
My question will be in Polish. Bardzo dziękuję. You need to switch micro into switch. Bardzo dziękuję za przygotowanie tego ciekawego i wszechstronnego raportu. On podziela bardzo wiele obaw i uwag ze strony wielu stolic europarlamentarzystów dotyczących odbudowy Ukrainy.
Jako europarlamentarzysta reprezentujący Polskę, ale też Europę Centralną, mam tu kilka uwag i kilka obaw, które wynikają z wniosków państwa raportu. Otóż wynika z tego raportu, że takie kraje jak Polska, Rumunia i Słowacja mają pełnić rolę logistycznych hubów i korytarzy transportowych służących do odbudowy Ukrainy. Natomiast cały impet odbudowy Ukrainy mają przejąć takie kraje jak Niemcy, Holandia czy też Francja.
I firmy z tych krajów mają przejąć główny zasób finansowy ze środków na odbudowę Ukrainy. W związku z powyższym moja wątpliwość dotyczy takiej percepcji, jaką panowie przygotowaliście w tej opinii, że kraje, zwłaszcza mój kraj Polska, który poniósł olbrzymi ciężar na samym początku wojny, przyjmując miliony ukraińskich uchodźców, przyjmując ich pod swój system socjalny, ale również udzielając olbrzymiej pomocy humanitarnej, wojskowej, wsparcia dla Ukrainy, ma w kontekście tego raportu być tylko i wyłącznie korytarzem transportowym i hubem pomocowym. No jest to dosyć niezrozumiałe. Widzieliśmy też na symulacjach, że Polska ma odbudować region, który dzisiaj jest okupowany przez Rosję.
No, budzi to duży, duży niepokój w moim kraju, w Polsce i liczne kontrowersje. Jak to jest, że ci, którzy na początku wojny, zwłaszcza Niemcy, wysyłali 5000 hełmów dla walczącej Ukrainy, a kraj, który wysyłał setki czołgów, dzisiaj ma być traktowany jako hub transportowy, a Niemcy, które blokowały pomoc dla Ukrainy na początku, pamiętamy, pamiętamy kanclerza Scholza i jego 5000 hełmów, dzisiaj mają być głównym beneficjentem odbudowy Ukrainy?
Tak więc mam pytanie, czy państwo braliście w tym raporcie pod uwagę te potencjalne zasługi wsparcie, które już kraje udzieliły od początku wojny, czy też nie było to w ogóle brane pod uwagę i z czego wynika ta proporcja, że jedne kraje mają być hubem transportowym, a drugie mają odbudować Ukrainę i z tego korzystać? Dziękuję.
So, we have to be a bit cautious of time. We have 15 minutes left. I understand that Mr. Brandstätter would like to take the floor, Bitteschön, and Mr. Brown. Okay, these three, then first Helmut.
Helmut Brandstätter
Thank you, David, and thank you for your report. Four questions, very short questions. First, demography. You talked about demography, that's very clear.
When I talk to people in Vienna, women with their children, very often they say they want to stay and they want to get their husbands to Vienna as soon as the war is over. Are there any ideas what could attract people to go back to Ukraine? My second question is about corruption. We know there is corruption. We also had very good conversation with these organizations NABU and SAPO.
And I think they're doing a really good job. They speak very openly about it. And you also talked about control by the parliaments.
You think it would be possible to have a kind of a control group, members of European Parliament, member of the Rada, to cooperate with NABU and SAP? My third question's about other countries. Are there any other countries who would be interested in invest in Ukraine apart from European countries and the US? And my fourth point is, it's not a question, it's my point, is about financing. We know about the frozen assets in in Europe.
We know who destroyed the country. And it's more than the 250 billion or whatever we have in in Europe. So I think it should be really clear that in first of all it's the Russians going to be those who have to pay for it. Thank you.
Villy Søvndal
I'll also do it short. Thank you very much for your reports.
We'll study it with a lot of a lot of interest. And of course there are a lot of things we do not know. Some of it is mentioned already. How many are going to return? I think it's linked to the question what are we then going to return to?
Will there be rebuilding of the of the destroyed things in a way that we could live a more or less normal life would probably be decisive for how many are going to return. When would the war stop? How much more would be destroyed the coming years? Even you are building up on your way that's also uncertain. We do not know that.
I think there are more who should contribute. Of course, Europe is going to stay by the side of Ukraine for sure. No doubt about that. I think Russia should pay its proper part. At least we have still the frozen assets in Europe.
I mean, it gives no sense if Russia can do this without being held accountable by the end of this.
Third, I guess there are other countries who would contribute as well. And finally, a membership for Ukraine would mean a much better economy for the country, also to take part of the rebuilding maybe that way.
So, there'll be a lot to do. Thank you.
Grzegorz Braun
Mr. Rapporteur, I understand you want to grant Ukraine full irresponsibility for anything. You want to take care about the flow of money and other resources for the benefit of the Kiev Banderist neo-Nazi regime without any expectations, without expectation to end the war, to have some peace agreement.
And you want to make defense industry, I read in your report, the national industry of such Ukrainian state. You want them to be chief exporters of guns, other other war tools and and maybe armed forces. So this is very dangerous for us. This is very dangerous for my country. We already paid the toll of treacherous and stupid government that sold out Poland and Polish army for the benefit of banderist Ukraine.
And I understand this is the policy that you want to contribute to. No responsibility, no peace, no rejection of neo-Nazi Banderist ideology entertained and nurtured by the Kyiv regime. Is that so?
David McAllister
Nobody else would like to take the floor?
Feel free to comment on whatever you would like to.
Mykola Nazarov
Thank you. I'd like to start with general note that I'm as Ukrainian extremely thankful for European Parliament, for European Union generally for support Ukraine, for every step you've done during all this more than four years to support Ukraine.
Regarding the first what I'd like to comment, reconstruction should be socially and economically fair. It's, we are absolutely sure with my colleague that there are geographical division in Ukraine. Western, for example, western parts of Ukraine are not so damaged as eastern and southern. And for sure it might be evaluated for the, I mean, for the process of post-war reconstruction of Ukraine. I haven't met any data, any research regarding this issue, what Ukrainian government plan to, how Ukrainian government plans to deal with it.
And in the framework of our research, unfortunately, we also didn't work on it. Regarding Poland as a transport corridor, in our research, for sure, we didn't treat Poland only as transport corridor and transport hub. It was only one dimension of our cooperation and one dimension of positioning of Poland, Slovakia and other states.
I believe that Poland will play a central role in reconstruction of Ukraine and in European Union accession of Ukraine. I believe that projects and collaboration in agriculture, in drone and unmanned technologies will be extremely beneficial for both sides for cooperate. So that's why we do not treat Poland, Slovakia and other countries only as potential transport corridors.
And maybe the last what I'd like to focus is demography because it's extremely important and if we do not solve this issue, any reconstruction will not be successful. I believe that Ukrainian government should do a lot to attract people to back Ukraine. So first is rebuilding Ukraine, rebuild that infrastructure that were lost during wartime. So Ukrainian citizens will not move back if it will be not proper social and other infrastructure. The second, it's security conditions.
So security conditions should be proper to live and to back Ukraine. And we met several of Ukrainian and European research that stressed attention that Ukrainian citizens are ready to back Ukraine only three, six months after ceasefire. So it will be not immediate back Ukraine, but it will be some process of three, six, nine months after ceasefire, which should be ready for it. Thank you for questions and thank you for your attention.
Thank you.
Anything else to add that Dr. Nazarov not touch upon issues that were raised? This is not the case. Well then thank you Dr. Nazarov for being with us today, also say hello to Mr. Teperyk. I think that's all for today.
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