The Association of Frontline Cities and Communities Proposes the Creation of a Fund and a New Economic Policy for Frontline Areas

The Association of Frontline Cities and Communities presented a package of measures aimed at ensuring the sustainable functioning of the economy in frontline regions. The key proposal is the creation of a Frontline Territories Support Fund – a tool for rapid assistance to businesses and communities that face the challenges of war on a daily basis. This was announced by Mayor of Kharkiv and Head of the Association, Ihor Terekhov, during the forum “Recovery of Ukraine: Quality Institutions and Economic Security” on 1 December.

“Frontline communities should not be perceived as ‘problem zones’ but as part of Ukraine’s national security system, including economic security. The risks there are different, which means the instruments of state support must also be different and correspond to current realities,”
emphasised Ihor Terekhov.

According to Mr Terekhov, a special Fund would be the foundation for implementing an updated state policy towards frontline regions allowing comprehensive support for frontline areas. Its role would be to deliver rapid solutions adapted to the conditions in which businesses and communities live and operate next to the front line.

“Frontline businesses do not need long procedures; they need quick, effective decisions: compensation for losses, financing for reconstruction, and the possibility to receive a comprehensive ‘insurance + loan + grant’ package. This is exactly what the Frontline Territories Support Fund should provide as a truly functioning institution, not yet another declarative project that exists only on paper,”
said the Head of the Association of Frontline Cities and Communities.

In parallel with launching the Fund, AFCC draws attention to the need for the full-fledged operation of the newly established National Development Institution with a dedicated line for supporting frontline areas. This institution should assume responsibility for insuring war risks and ensuring real credit programs for local businesses.
Another important step is restoring equal access for frontline communities to state programmes. AFCC proposes the introduction of a separate category of high-security-risk projects and granting them priority in grants, loans, investment programmes and recovery projects.

“For communities near the front, submitting an application is often harder than implementing the project itself. We propose introducing a rule: more risk – more support, which would allow high-risk projects to receive priority in all government institutions,”
stressed the Head of the Association.

Another block of proposals is resilience infrastructure – logistics, energy and human resources. The Association stresses that frontline businesses cannot function without protected logistics routes, shelters at enterprises, backup power lines and housing programmes for critical infrastructure workers.

“We are talking about basic things: a protected ‘last mile’, shelters at production sites, generators, storage systems, backup lines, housing for people who are ready to work near the front. If the government creates the right conditions, frontline areas will transform from risk zones into areas of opportunity,”
underlined Ihor Terekhov.

According to him, it is also important to expand opportunities for small and medium-sized businesses, especially in the processing sector, which is one of the most resilient to wartime risks.

“Processing can create jobs even under shelling. That is why we propose dedicated grant instruments and investment programmes for SMEs in frontline areas,”
said Ihor Terekhov.

In conclusion, the Head of AFCC stressed that the proposed package of measures is the minimum necessary foundation for strengthening resilience, recovery and development:

“We are fully aware of the potential of businesses in frontline areas. To unlock it, the government must tell an entrepreneur near the front: ‘Yes, you have more risks, and that is exactly why we are here and creating different conditions for you.’ This is what fair support means; this is what a responsible government strategy looks like – one that will allow frontline regions to become territories of future growth for Ukraine,”

summarised Ihor Terekhov.