Multi-Donor Trust Fund for Co-financing of the Public Expenditures for Administrative Capacity Endurance in Ukraine (PEACE)

Description What is done in the programme or project and why, what results are pursued, who benefits from the activities and who are involved in the implementation.

The Russian invasion in Ukraine on 24 February 2022 has led to considerable economic losses and humanitarian suffering in Ukraine. The decline of Ukraine’s economy threatens the already achieved development results and raises poverty among the population. The Public Expenditures for Administrative Capacity Endurance (PEACE) in Ukraine includes MDTF's grant, IDA and IBRD Financing. Finland's support is channeled through the MDTF. The MDTF supports the Government of Ukraine (GoU) in sustaining core government functions at the national and regional levels and providing education services during the war. Unlike in some other countries at war, the GoU continues to play a crucial role in making policy choices and providing services to its people. The GoU maintains control over key state functions such as collecting revenues, making social payments, responding to emergencies, and sustaining education services with over 90 percent of schools functioning and serving 3.6 million students in grades 1-12 (as of April 15, 2022). It is extremely important to keep core government and education services functioning during the war to minimize loss in human capital, deliver core government services and secure lasting peace to rebuild the country and its economy after the war. The MDTF contributes to sustain the core government and education services by funding the non-security sector wage bill of government and school employees in Ukraine. MDTF will be channel resources to co-finance the financing needs of GoU and school employees. Finland supports Ukraine’s resilience and long term reforms. The objectives of Finland’s country strategy in Ukraine include protecting Ukraine’s territorial integrity and sovereignty and safeguarding the respect of international law. Further objectives are strengthening of bilateral relations and cooperation, improving livelihoods of Ukrainians and the resilience of the society as well as supporting the deepening of the relations between Ukraine and the European Union. The provided support contributes to Finland's development policy priorities on promoting peaceful and democratic societies and sustainable economy and education in accordance with the Government's Report on Development Policy Across Parliamentary Terms.