Romania - logistic hub for the reconstruction of Ukraine

George Marinescu
English Section / 14 decembrie 2023

Romania - logistic hub for the reconstruction of Ukraine

Versiunea în limba română

Foreign investments, ensuring a transparent and efficient flow of financial capital and increasing human capital are essential for the reconstruction of Ukraine, argued the participants of the first day of the international conference "Reconstruction of Ukraine and the strategic role of Romania", organized for two days by the New Strategy Center at Sinai. They also stated that public and private companies from EU member states that will participate in the reconstruction of Ukraine need the support of the central and local authorities in that country with which to conclude public-private partnerships for the completion of all started projects.

At the opening of the event, in the video message sent to the conference participants, Prime Minister Marcel Ciolacu said: "Relations between Romania and Ukraine will soon reach the level of a true strategic partnership. An essential component of the partnership will be the logistic hub that we will organize on the territory of Romania, for the reconstruction and assistance of Ukraine. We have before us a major challenge, given by Russia's illegal and unprovoked invasion of Ukraine. It is a direct threat to security and stability in the Black Sea area, with negative effects felt globally, when we talk about food security in the most vulnerable countries or energy security. Incessant attacks by Russian forces in Ukraine actually confirm Russia's frustration with the solidarity of Europe, the Euro-Atlantic community and, in general, democracies around the world for Ukraine. (...) I emphasize that Romania acts and will continue to be the promoter of the concerted measures of the Euro-Atlantic community for the resistance of Ukraine and the reconstruction of these countries, within the European integration process. Europe cannot afford Ukraine to lose. We believe in the victory of Ukraine, being aware that more help and effort is needed from international partners".

The Head of the Government mentioned that Ukraine and Moldova need multisectoral support and that the European and North Atlantic allies agreed that regional infrastructure projects and strategies regarding this area should also include the projects of the two states.

Over 70% of Ukrainian cereals are exported through Romania

Marcel Ciolacu also showed that more than half of the exported Ukrainian products transited our country and together with the authorities in Kiev, the Executive from the Victoria Palace planned extensive investments regarding the development of the transport infrastructure in our country, infrastructure to benefit from the export of. grain from the neighboring country and the transit of products from Ukraine. Among the completed investments, the prime minister mentioned the operationalization of the wide-gauge railway in Galati and the increase of storage and operating capacities in the Port of Constanţa.

The Head of Government said: "All our major ports are running huge funding programs for grain storage and loading-unloading equipment. We will succeed in doubling Romania's traffic capacity for grain and essential goods of Ukraine destined for the European market and the global market. Romania is ready to develop a logistics center needed by Ukraine. The connections we will build will serve the sea and land colors of central and south-eastern Europe. I am sure that the initial plans of the European Union and the Three Seas Initiative will gain speed in implementation".

For his part, the Ukrainian Prime Minister, Denys Shmyhal, showed that the measures taken by the Bucharest authorities regarding financial, military support and logistical cooperation have proven their effectiveness, if we only take into account the fact that currently 70% of Ukrainian grains . are transported through Romania.

Denys Smyhal also said in the video message addressed to the participants of the conference: "I am confident that soon we will be part of a single family of European nations and we hope that Romania will participate in the reconstruction of Ukraine. We suffered unprecedented damage: more than 257,000 civilian targets were destroyed or damaged, including schools, hospitals, more than 30% of buildings and 50% of the electricity network. These numbers are shocking, and behind the destroyed goal are lives. That is why everything that was destroyed must be rebuilt. The reconstruction of Ukraine is based on the principle of building again, better, to provide opportunities for Ukrainians to return to their own country. (...) I ask the Romanian business community to invest in Ukraine for capital growth. The investments will contribute to the growth of important export centers in the region. It is important that Ukraine and Romania have a common vision based on principles and pragmatism".

The head of the Government in Kyiv mentioned that the reconstruction of Ukraine is structured on six priorities. The first priority is in the field of energy, where the Ukrainian government wants to secure and develop the production capacities of nuclear energy, energy from renewable sources and to repair and strengthen the transport networks in this area.

Denys Shmihal continued: "The second priority refers to the military field, both to the provision of military equipment, but also to the construction by the Ukrainian industry in partnership with our allies of production capacities in the defense industry. The third priority concerns the development of traditional markets, the fourth concerns the development of natural resources, the fifth is infrastructure and the development of construction machinery, and the sixth concerns the resilience of public authorities and institutions".

Ionel Niţu, the president of the New Strategy Center stated: "Romania can concretely contribute to increasing the energy independence of Ukraine, but also of the Republic of Moldova, to strengthening the capacity of Ukrainian institutions and restoring the civil, energy, military infrastructure, as well as the distribution chains that have were destroyed in this conflict".

Radu Oprea: "Romania has the opportunity to become the best logistic center for the reconstruction of Ukraine"

Radu Oprea, the Minister of Economy, stated that our country is currently involved economically and from the point of view of the defense industry in Ukraine, to help the authorities in Kiev, and a memorandum was signed in this regard to increase production capacities in the two states.

The Minister of Economy said: "But these are the objectives for the current period. We also have to think about the future. And the future means the reconstruction of Ukraine. Romania must be at the forefront of the reconstruction of Ukraine. Today, Ukrainian grains are passing through Romania to the ports of Sulina and Constanţa, we are making investments in the infrastructure to receive these grains, investments that engineers and people are working on that will later be used in the reconstruction of Ukraine. Ismail and Odesa represent the places where the reconstruction of Ukraine must begin, because the two cities were destroyed by the bombings of the Russian Federation. Following the recent official visit to the USA with Prime Minister Marcel Ciolacu, I noted that American companies believe that Romania can be a perfect logistic hub for the reconstruction of Ukraine, because we are a NATO state and a member state of the European Union that has the necessary infrastructure for to reach Ukraine more easily. We received the same opinion from the German companies that have subsidiaries in our country and that could through them participate in the reconstruction of Ukraine. On the Romanian-Ukrainian border we can have logistics centers everywhere. In free zones, if the Parliament will quickly adopt the necessary legislation so that the respective companies can operate in our country and can bring equipment from abroad. Companies from Romania will be added to these companies in the effort to rebuild Ukraine. We want to participate with companies that make construction materials, with engineers, with qualified personnel, alone or in partnership with other companies. Our participation in the reconstruction of Ukraine will start in January 2024. We have included in the budget for next year the creation of the necessary production capacities to supply the goods and products that will be used in the reconstruction of Ukraine. I believe that Romania has the opportunity to become the best logistics center for the reconstruction of Ukraine, which also means benefits for the Romanian people who will benefit from jobs in areas where there will be a high intensity of companies".

In a video message addressed to the participants of the conference in Sinaia, Oleksandr Kamyshin, the Minister of Strategic Industries from Ukraine stated that he has a good collaboration with the Minister of Economy from Romania, with the defense industry in our country, a collaboration that will strengthen the defense of Ukraine but also the production capabilities of the defense industry in our country.

Ukrainian grain traffic on the Danube will increase to 4 million tons per month

Present at the event, Oleksandr Kubrakov, Deputy Minister of the Development of Territorial Communities and Infrastructure of Ukraine, said that the Kyiv authorities want to encourage Ukrainian refugees to return to their homelands by strengthening the economy, developing infrastructure and rebuilding the country transparently and efficiently. .

The Ukrainian official stated: "We want to restore the transport routes and reduce the logistics expenses regarding the export of goods between Ukraine and the EU member states. The authorities are making efforts to attract investments, and the private sector can participate in public procurement procedures, as we purchase various services externally. We want to accelerate the crossing of land borders by implementing digital tools, and in this sense we value Romania's strategic role in facilitating our exports. We want to increase and strengthen the transport capacities on the Danube from 2.5 million tons per month to 4 million tons. In the field of road transport, we want to realize the Reni-Galaţi green corridor, with transit through the Republic of Moldova, to rebuild other border crossing points, which will reduce waiting times and lead to the acceleration of exports. We have a long-term project that refers to the crossing point near Vicovul de Sus, which we want to exploit, also for export. At Siret customs we want to open service centers for transporters from both countries, and at Sighetu Marmaţiei and Biserica Albă we want to use the crossing points for the export of grain that will reach Constanţa and Galaţi. We need more border crossing points with Romania, points that can handle the large volume of goods. For example, at the beginning of December, more than 2,500 freight vehicles were waiting at the crossing points".

Oleksandr Kubrakov also showed that in the last 12 months the Ukrainian ports on the Danube have registered a cargo traffic of over 30 million tons and mentioned: "Constanţa Port is not only a very strong transport hub, but also a strategic gateway for goods our. The development of the road infrastructure in Romania and the port of Constanţa will ensure the facilitation of exports. Together with you, we are consolidating roads and developing transport capacities from the Danube and the Black Sea".

USA and France, involved in the reconstruction of Ukraine

The US will continue to provide the support Ukraine needs, both for defense and reconstruction, Penny Pritzker, special representative for economic reconstruction of Ukraine, said at the conference.

Penny Pritzker pointed out: "The reconstruction of Ukraine is not only essential for the Ukrainian people, but also for the Black Sea region. Economic assistance is essential, and Putin understands that, which is why he attacked economic targets in Ukraine. We need to help Ukraine become an economically viable country, (...) and every investment that helps the economy and develops the tax base strengthens the resilience and resilience of the Ukrainian population. (...) The US does not act alone. More than 50 of the world's nations have joined us in supporting Ukraine economically. We must act to ensure that Ukraine not only has the support it needs for survival, but also for future development."

France is one of the strong contributors to supporting Ukraine, said Pierre Heilbronn, France's special envoy for the reconstruction of the new neighboring country.

Pierre Heilbronn said: "We are trying together with our partners to draw up a short-term action plan, but which also offers a long-term perspective on the reconstruction of Ukraine. At the moment, there is a question mark over the sustainability of US support for Ukraine, because of the discussions in the Congress in Washington. Unity and decision are needed to support Ukraine, both at the European and NATO levels. We are committed on a multi-year basis to support infrastructure investments, both in Ukraine and in neighboring countries, including Romania. France and its European allies will also invest in Ukraine's economy, but also in the field of defense. In Romania we have the largest number of French soldiers through which we contribute to ensuring regional security. But the reconstruction of Ukraine also requires the support of entrepreneurs, civil society, and central and local administrations. Over the past 24 months, we have seen that resilience and resilience is based on the ability of local authorities, mayors and entrepreneurs to overcome the challenges they face."

Jean Froehly: "Romania's role is essential in facilitating Ukrainian exports"

Romania has an important role in the leadership regarding the reconstruction of Ukraine, stated Jean Froehly, head of the Task Force for the Conference for the Reconstruction of Ukraine that will take place next year in Germany.

Jean Froehly also said: "I think it is very important to take into account the fact that Ukraine is currently at war and has to face daily attacks from the Russian Federation. That is why we must not reduce the military support given to Ukraine, and Germany decided to double, to 8 billion euros, the military support given to this country. We must continue this support despite domestic financial constraints. We will have to make sure that the damage caused by the Russian attacks is repaired and that the Ukrainian economy is consolidated and keeps pace with the European one, and here Romania's role is essential in terms of facilitating Ukrainian exports".

The German official stated that in the reconstruction of Ukraine an important role this will be played by investments and private capital, which will be essential in the steps taken by the member states of the European Union. His lordship also said that the Ukrainian authorities must help foreign investors find viable partners in that country and that to attract foreign investors it is necessary to present the European dimension of Ukraine and its approach to integration into the European Union.

Jean Froehly also showed that in the process of reconstruction and recovery of Ukraine, an important role will be played by local communities, as well as local human capital, including the involvement of the Ukrainian diaspora.

Davide La Cecilia, specially commissioned for the reconstruction of Ukraine by the Ministry of Foreign Affairs of Italy said that his country has already committed to contribute decisively to the reconstruction of the city of Odesa, to work on the master plan of this city, but also on the master plan of the Mikolayev industrial town.

Greek Ambassador Spyridon Lampridis pointed out that although there is support of many billions of euros, this financial support does not solve all the problems facing Ukraine, but it must continue. Lampridis stated: "If we wait for everything to calm down and only then rebuild, it will be too late for Ukrainian society. We want a stable security environment that allows the flow of capital to Ukraine in an organized and transparent manner. (...) Experience shows us that private capital does not go alone in risk areas, but follows the attitude of international or financial institutions. But for the reconstruction of Ukraine we have the involvement of the big donors who are already managing a large amount of money".

Mines and jamming of communications, the main obstacles to freedom of navigation in the Black Sea

In one of the panels that were organized yesterday during the whole day, the freedom of navigation in the Black Sea was also discussed. Admiral Liviu Coman stated that from the beginning of the conflict in Ukraine until now, Russia has blocked freedom of navigation in half of the Black Sea and that a real problem is the drifting sea mines that are on the trade routes. However, according to Mr. Coman, more than 1000 commercial ships have so far transited the exclusive economic zone of the Black Sea and transported more than 33 million tons of grain from Ukraine.

Vergil Chiţac, the mayor of Constanţa, said that he does not expect a quick end to the conflict and said that he believes that the mines that are drifting in the Black Sea are not only Ukrainian mines blown up by storms, but also originally placed mines by the naval forces of the Russian Federation.

Vergil Chiţac said: "From the information I have at the moment, I say that so far 82 sea mines have been neutralized in the Black Sea, of which 67 mines are in the Ukrainian area. I refuse to believe that these 67 mines were Ukrainian ones removed from the dams that the Ukrainians made at the entrance to Odessa. They were certainly launched by the Russians, either from Crimea or from helicopters."

Admiral Liviu Coman also showed that Russian forces permanently jammed communications, which prevented freedom of navigation in the Black Sea.

Today, on the second day of the international conference in Sinaia discussing the reconstruction of Ukraine, the main topics of debate will be the security guarantees offered to Ukraine within the new European security architecture, how Romania responds to the security challenges generated in the Black Sea area of the Russian-Ukrainian conflict, cross-border cooperation, Black Sea gas reserves, global food security challenges and opportunities, challenges for private investors in the reconstruction of Ukraine, resilience of Ukraine's strategic infrastructure, US Black Sea strategy and opportunities and challenges in financing reconstruction projects.