The Danish Government enters broad agreement to establish Ukraine Fund in 2023

The situation in Ukraine is extremely critical and the need for significant support is urgent. Ukraine’s fight for freedom is a fight for democratic values and society.

The Danish Government has thus joined with a broad majority of the Danish Parliament to establish a fund of approximately DKK 7 billion in 2023.

In addition to this, funding is also allocated in 2024-2027 to help cover the costs of replacements associated with military donations made in 2022 and 2023. The fund will have three components:

1. Military support of Ukraine’s fight for freedom in the form of weapons, other military equipment, training efforts, etc. A framework of approximately DKK 5.4 billion has been allocated in 2023 for military support.
   
   
2. Civil support targeting urgent humanitarian efforts and long-term reconstruction. A framework of DKK 1.2 billion has been allocated in 2023 for civil support in Ukraine and other Eastern European neighbouring countries.
   
   
3. Support for business initiatives that give Danish companies the opportunity to contribute to the reconstruction of Ukraine. A framework of approximately DKK 0.4 billion has been allocated in 2023 for business initiatives.

Minister for Finance Nicolai Wammen says:

“Last year we came together for a historic national compromise on Danish security policy. This was necessary in light of Russia’s invasion of Ukraine. With today’s agreement, we are giving over DKK 7 billion more to the effort in Ukraine, and we are doing this in a way that is fiscally responsible. I am pleased that a broad majority of the Danish Parliament is taking responsibility and showing that Denmark stands with Ukraine. Denmark is already one of the countries which, in proportion to our size, supports Ukraine the most. The Government and the parties to the agreement have now ensured that this will remain true.”

Minister for Foreign Affairs Lars Løkke Rasmussen says:

“We stand at a historic crossroads. The Ukrainians are not only fighting for their freedom, but for the security of all of Europe. With the Ukraine Fund, we are taking Danish support for Ukraine to a new level. Importantly, this includes trade support. Danish companies can supply much of what Ukraine needs, including drinking water, district heating and food. Therefore, we must intensify our efforts. With the support of the new fund, we will strengthen efforts by the Ministry of Foreign Affairs of Denmark to help Danish companies enter the Ukrainian market and allocate additional funding to improve the conditions for Danish companies’ risk-intensive investments in Ukraine. This is good news for Ukraine and for the Danish business community.”

Acting Minister of Defence Troels Lund Poulsen says:

“Denmark supports Ukraine’s fight for freedom together with the rest of the free world. That is why we will continue to support the Ukrainians with donations of military equipment, funding and training that supports their fight against Russia. Denmark has already given approximately DKK 5 billion in military support to Ukraine, and with the newly established Ukraine Fund we intend to maintain a high level of military support for Ukraine. This will make a real and impactful difference for the Ukrainians. Their fight is also our fight.”

Minister of Industry, Business and Financial Affairs Morten Bødskov says:

“Ukraine urgently needs help to rebuild the critical infrastructure that Putin is purposefully destroying with violent missile attacks. With a brand new scheme under Denmark’s Export and Investment Fund, we are securing around DKK 1 billion for loans and guarantees for the Danish companies that will contribute to the reconstruction. At the same time, we are coordinating closely with Danish companies in an operative forum. Putin must not win. Therefore, we are joining with the Danish business community to take our support for Ukraine to a new level.”

Minister for Development Cooperation and Global Climate Policy Dan Jørgensen says:

“We are helping here and now with humanitarian efforts to meet the most basic human needs of the hard-pressed Ukrainians. This means, for example, ensuring access to water and electricity. At the same time, we are already starting the reconstruction of the country. This is about moving as quickly as possible to get as close to normal conditions as you can in a country during a war.”

The parties to the agreement have agreed to ease fiscal policy by approximately 0.2% of GDP in 2023, which provides DKK 5.6 billion in 2023 that will be used for military and commercial support. The easing of fiscal policy is assessed as feasible within a responsible fiscal policy framework, and a significant tightening of fiscal policy is still planned for 2023 as measured by the one-year fiscal impact.

The parties to the agreement also agree that the framework for civil support will be financed within development assistance.

Download fact sheets here:

• Fact Sheet - Military support to Ukraine
• Fact Sheet - Civil support for Ukraine
• Fact Sheet - Business Initiatives under the Ukraine Fund