The UK could play a leading role in rebuilding the lives of the people of Ukraine by formulating a plan that helped clear legal pathways to redistributing frozen Russian assets to victims of the invasion.
The World Bank’s estimated £350 billion reconstruction costs the World Bank would ‘probably be findable’ if Britain were to help to repurpose frozen Russian state and oligarch assets to pay reparations – while clamping down on their ‘enablers’ in the City.
The West did not have the patience for a foreign aid programme on the scale of the Marshall Plan put in place after the Second World War. What was needed was a ‘coherent’ policy – bringing together multiple organisations with private investors and re-using seized assets, while clamping down on the UK estate agents, lawyers and accountants working to conceal them.
The proposals were outlined at a Radix London Leaders’ Summit workshop that included academics, business investors and bankers led by Camille Wallen, director of strategy of the HALO Trust, a charity that is clearing landmines in the country.
Actions the UK could take to support reconstruction included making sure private investment in the Ukraine was well targeted, co-ordinated and accountable, she said.
Global official development assistance – £178 billion last year – was stretched ‘all over’, some going to Covid response and some going to refugee costs. Britain now needed to set out a ‘coherent’ plan that would help to attract private investment for the regeneration of Ukraine and play its part in getting corrupt money out of the system.
“The explosive remnants of this conflict haven’t been seen in Europe since the Second World War. From my experience of funding cycles, there is a lack of a coherent plan and without it, we do not see sufficient global funding to deliver on this massive cost of reconstruction in Ukraine,” she said.
Katherine Mulhern, a former human rights investigator and chief executive of Restitution, an organisation specialising in recovering stolen assets, urged Britain to move swiftly to help to ‘take the assets out of the hands of the kleptocrats’.
“We are looking at a cultural genocide. We don’t talk about human rights violations as much as we should but we are effectively looking at a kleptocracy.”
The kleptocrats had ‘gone to ground’ she said and a fund was needed to ‘go after these people’.
“Investigators had found between £40 and £60 billion dollars that are recoverable assets and could be returned to the Ukraine to help reconstruct the country,’ she said. ‘We think £350 billion is probably findable if you get investigators, lawyers and others to start looking for it. It’s a perfect opportunity to deploy private sector assets.
“We need to suck this kleptocratic money out of the system – there are billions of dollars that are being transferred through the global financial system, including in London. The money is being used to weaken the states around them and ‘buy off’ people in, say, the United Nations or the World Health Organisation.”
Democratic states with very quick turnovers in terms of governments didn’t necessarily have the patience to build over the long term, she added. Private capital, which would put in money for ten to fifteen years was needed to rebuild a country ‘ripped up from its roots’ but governments could provide ‘first loss capital’ encouraging the private sector to follow and provide guarantees.
“There is a problem that some of the seized assets start to deteriorate very quickly so you need to sell them and redeploy them quickly or they become worthless.”
International institutions like the European Bank for Reconstruction and Development could act as catalysts, the meeting heard. ‘No fly’ lists should be used, especially at board level, and the risks should be taken into account by the rating agencies. British companies with assets in Russia they can’t do anything with because they are sanctioned should be persuaded to donate money they generate to a foundation for the regeneration of Ukraine with a sanction-waiver.
Christopher Peters, director and chief operating officer of Aperio Intelligence, backed the no-fly list plan. “This could ruin the careers of high-flying lawyers, estate agents or accountants. It’s an easy win…. If a country is making huge profits in kleptocratic countries, the rating agencies need to question this,” he said.
Dr Anja Richter, of the Hanns Seidel Foundation, named after the former Bavarian prime minister and CSU chairman, which promotes “political education” on Christian foundations, called for countries like the UK, who had taken in Ukrainian refugees, to make use of its Ukrainian diaspora. ‘There are over a million Ukrainians in Germany you could use as a channel.
They know what’s best for their local communities and on a lower level, they may have led a small company that could quickly restart with outside help, she urged.
Dr Uilleam Blacker, associate professor of Ukrainian and East European Culture at University College London, called on organisations such as the British Council and London’s Ukrainian Institute to work more widely with people on the ground to help rebuild the ‘cultural fabric’ of the country.
“Russia is trying to destroy Ukrainian statehood on a political level but we also see the targeting of cultural heritage buildings such as museums, theatres and universities. Occupying forces are given hit lists of writers and artists. Many of them have been murdered. The Ukrainian government estimated earlier this month that almost six hundred important cultural sites had been completely or partially destroyed.”
He explained how reconstruction obviously had to prioritise housing, energy, transport infrastructure and health but, he added: “We have to think about doing this holistically. We are not just talking about buildings and roads but communities that have identities that have memories and stories attached to places articulated through culture.
“We have to think about supporting people in rethinking the connection they have to the places in which they live, support for state cultural agencies, whose funding has largely been directed towards the military, in the form of grants, fellowships, knowledge-exchange activities.”
“Local people know what the stories are that bind people to those places and not to take those into account would be a mistake. It is important to centre reconstruction around local memory and work with grass roots civil society organisations.”
The meeting agreed that reconstruction had to be targeted and accountable and could not be achieved without ‘Ukrainian voices’.