Almost 18 months after Russia’s invasion, Ukrainian officials are still pressing Western governments for any military or humanitarian aid they can spare. But that assistance alone won’t sustain its economy for the long term, Sergiy Tsivkach, the executive director of Ukraine’s government office for attracting foreign investment, told MM. U.S. government support is only available “because American industry is paying taxes,” said Tsivkach. “The time has come for American industry to look at Ukraine – not as a charity project — but as a destination where they can make profits.” That was a difficult sales pitch even before the invasion torched Ukrainian industry and upended global politics. Foreign direct investment in the country whipsawed for more than a decade as investors balanced its considerable agricultural resources and burgeoning fintech sector against significant geopolitical risks and troubling levels of corruption. Ukraine’s earlier efforts to attract outside investment were sometimes characterized by “false optimism” that “this was going to be a straight up moonshot,” former Cargill Chairman and CEO Greg Page said in an interview. Cargill, a Minnesota-based agricultural giant, spent decades building a sizable footprint in the country. Despite its challenges, Ukraine’s low logistics costs, ports, soil quality and proximity to countries with significant grain deficits made it an important market for Cargill — even after its 20 year-old plant in Donetsk became a flashpoint during Russia’s annexation of Crimea, Page now holds a seat on a Center for Strategic and International Studies commission that’s helping Ukraine attract private investment. Tsivkach is scheduled to speak at an event hosted by CSIS in Washington next month to discuss policies to “guide the economic modernization and transformation of Ukraine.” The headwinds for that transformation remain formidable. Ukraine’s counteroffensive against Russian forces has proven arduous. Small units – some of which are leaving their U.S.-supplied military vehicles behind to avoid being spotted by Russian artillery — are “battling a few hundred yards at a time, with occasional success,” The WSJ’s James Marson reported from Zaporizhzhia on Wednesday. The slow progress comes as public support in the U.S. for providing more aid has started to fade, particularly among Republicans, according to a recent CNN poll. The grueling counteroffensive and uncertain political climate have inevitably made things “wait-and-see” for many investors considering Ukrainian projects, Page said. “It'd be naive to assume people aren't being more cautious.” To that end, Tsivkach is making the rounds with think tanks and industry organizations across the U.S. and Europe. BlackRock and JPMorgan Chase were enlisted to aid in the development of a reconstruction bank earlier this summer. Tsivkach said government officials are hopeful to have funds available through that project by the end of the year. And Kingspan – an Irish building materials group — is moving ahead with a $300 million construction project, he said. Tsivkach says he doesn’t view U.S. policymakers as much of an impediment in his efforts. “Some political parties [are] trying to exploit this topic in order to get some support, but I'm sure that these arguments will decline and will not find any support — or significant support — amongst the American people when we connect our country's industries,” Tsivkach said. IT’S THURSDAY — Have you had a chance to dig into the private funds rule? Send tips, gossip and suggestions to Sam at ssutton@politico.com.
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