25.06.2026 | News
To further support Ukraine’s green recovery and reconstruction efforts, Nefco will resume its lending activities to Ukrainian municipalities. The new lending programme will be backed by the European Union’s Ukraine Investment Framework (UIF) and receive financing from the Nordic Investment Bank (NIB), enabling investments in critical green infrastructure and municipal services that will further strengthen the resilience of Ukrainian municipalities.
In connection with the Ukraine Recovery Conference in Gdańsk, Poland, Nefco has signed a letter of intent with the European Commission, marking a significant step towards scaling up blended financing for Ukraine’s green recovery. The new programme will combine loans, investment grants, guarantees and technical assistance.
“This signing is an important milestone for Nefco’s operations in Ukraine. By restarting lending, we can once again offer municipalities blended financing that combines loans with grants and technical assistance. This will enable investments that are critical for a resilient and sustainable recovery under extremely challenging conditions,” says Ulf Bojö, Vice President, Eastern Europe at Nefco.
This initiative builds on Nefco’s long-standing engagement in Ukraine and forms the second phase of the Nefco Green Recovery Programme for Ukraine, launched in July 2022, with contributions from the European Union and the Nordic countries. The first projects under this new initiative are expected to take off in autumn 2026.
The new programme allows Nefco to resume lending activities after a four-year pause and to transition from fully grant-based support to a blended finance model. Approximately EUR 117 million in financing, including up to EUR 7.15 million in technical assistance, and up to EUR 70 million in guarantees will be mobilised for EU-aligned green recovery municipal investments related to energy efficiency, water infrastructure, district heating and renewable energy in Ukrainian cities.
The EU contribution, provided under UIF, includes EUR 40 million in investment grants and EUR 5.15 million in technical assistance, alongside risk-sharing instruments, i.e. guarantees from the EU of up to EUR 63 million, to enable lending in a high-risk environment.
“Ukrainian cities know best what their people need. Today we have taken an important step to give municipalities more financing to repair water systems, modernise heating and invest in clean energy. We are helping local communities build back better,” says Marta Kos, European Commissioner for Enlargement.
NIB will provide EUR 70 million in loan financing, channeled via Nefco to Ukrainian municipalities, supported by the UIF guarantee and complemented by investment grants and technical assistance.
“Ensuring that Ukrainian municipalities can restore and maintain critical infrastructure is essential for communities and economic recovery. This financing addresses urgent needs while supporting the rebuilding of more resilient and sustainable local systems, demonstrating what can be achieved through close cooperation between committed partners,” says André Küüsvek, President and CEO of the Nordic Investment Bank.
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About Nefco Green Recovery Programme for Ukraine
Nefco’s Green Recovery Programme for Ukraine supports the rebuilding of critical infrastructure and the development of sustainable, resilient municipal systems across the country. The first part of the programme, which is fully grant funded, brings together over EUR 500 million in financing from the European Union and the Nordic countries. It currently supports more than 50 projects across 35 communities in Ukraine. Since 2022, over 40 projects have been completed, with investments focusing on energy efficiency, renewable energy, heating, water, waste and other essential municipal services. The programme combines grant financing with technical assistance and capacity building to ensure lasting impact at the local level. Read more on: www.greenrecoveryukraine.org
About UIF
The Ukraine Investment Framework is the investment arm of the EUR 50 billion Ukraine Facility of the European Union, designed to attract public and private investments for the recovery and reconstruction of Ukraine. It combines EU guarantees, grants and financial instruments totalling more than EUR 9.7 billion to support projects aligned with EU priorities, including the green transition and sustainable infrastructure. Read more at uif.eu and Ukraine Investment Framework – Enlargement and Eastern Neighbourhood
About NIB
NIB is the international financial institution of Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway, and Sweden. The Bank finances projects that improve productivity and benefit the environment of the Nordic-Baltic region. The Bank is headquartered in Helsinki with a regional hub in Riga. NIB has the highest possible credit rating, AAA/Aaa, with S&P Global Ratings and Moody’s. Read more on: www.nib.int
