The Swiss model for Ukraine’s reconstruction: how economic competitiveness becomes a response to war

The reconstruction of Ukraine after Russia’s full-scale invasion is not only about destroyed buildings and bridges. It is a far deeper challenge: how to rebuild an economy operating under the pressure of war, migration, resource shortages, and constant uncertainty. In this context, Switzerland’s approach stands out for its clear logic — rebuilding not “as it was,” but in a way that makes the economy competitive, resilient, and integrated into Europe.

Switzerland’s Country Programme for Ukraine for 2025–2028 sets the framework for this approach. It is the first phase of a long-term 12-year support process with a total volume of up to CHF 5 billion, of which CHF 1.5 billion is planned for this initial period. At the core of the programme are the private sector, reforms, and Ukraine’s ability to develop even under wartime conditions.

A war that transformed the economy

For Ukraine, the war has been not only a military shock but also an economic one. A sharp decline in production, large-scale destruction of infrastructure, and damage to the energy system have fundamentally reshaped the country’s economic reality. A significant share of state revenues is directed toward defence, while social and investment needs continue to grow.

The private sector has been particularly hard hit. Businesses have lost production capacities, logistics chains, and personnel. Mobilisation and mass migration have led to labour shortages, while constant risks continue to deter investment. Under these conditions, restoring business activity has become a matter of survival for the economy as a whole.

Why Switzerland goes beyond humanitarian aid

The Swiss approach is based on a simple but fundamental conclusion: an economy that cannot compete cannot be resilient. This is why the programme focuses not only on assistance but on creating conditions for growth — innovation, development of local value added, and access to international markets.

Reconstruction in this sense is an opportunity to rethink Ukraine’s economic model. Instead of returning to pre-war structures, the programme promotes a transition toward a more efficient, transparent, and integrated economy capable of withstanding external shocks and meeting European Union standards.

Lugano as a starting point

The foundation of this approach lies in the so-called Lugano Principles, formulated at the Ukraine Recovery Conference in 2022. They define the core rules for reconstruction: partnership with Ukraine, transparency, accountability, inclusiveness, gender equality, and sustainability.

For Switzerland, these principles did not remain declarative. They have become practical tools — from programme design to project evaluation and the definition of funding priorities.

The private sector as a driver of recovery

One of the key ideas of the programme is the active role of the private sector. Business is seen not as a passive recipient of aid, but as a full-fledged partner in reconstruction. This applies both to Ukrainian enterprises and to the potential involvement of Swiss companies.

The programme provides support for the preparation of infrastructure projects, facilitates procurement of goods and services, promotes partnerships, and creates instruments to reduce investment risks. In wartime conditions, such mechanisms can be decisive for bringing private capital back into the economy.

SMEs — the economic backbone of Ukraine

A particular focus is placed on small and medium-sized enterprises, which traditionally form the backbone of Ukraine’s economy. SMEs adapt more quickly to change, create jobs, and sustain community life.

Swiss support aims to ensure that SMEs not only survive but integrate into international markets. This includes the development of industrial zones, vocational training, and the economic inclusion of internally displaced persons, veterans, and women. Such an approach combines economic recovery with social stability.

Solar panels as an example of energy infrastructure development and modernisation.

Source: Shutterstock / skyNext

Reforms as a condition for a European future

Economic competitiveness is inseparable from reforms. Judicial reform, public administration, anti-corruption policy, and the protection of property rights are essential — without them, access to the EU’s single market will remain out of reach.

Switzerland emphasizes the importance of aligning financial support with Ukraine’s reform commitments and coordinates its actions with international partners. The goal is not the number of projects, but their real effectiveness.

The social dimension of economic recovery

The war has transformed not only the economy but society as well. Millions have lost their homes, poverty levels have increased, and education and healthcare systems are operating at the limits of their capacity. Around forty percent of the population requires humanitarian assistance.

Switzerland’s approach recognizes that economic growth is impossible without restoring basic services. Education, healthcare, energy supply, water, and social protection are seen as the foundation for people’s return and the recovery of the labour force.

Resilience instead of quick fixes

The key concept of the programme is resilience. This is not about quick results, but about Ukraine’s ability to function under prolonged instability. Switzerland builds in flexible programme management, continuous monitoring, and the ability to adjust priorities as the situation evolves.

In this approach, Ukraine’s reconstruction is a long-term process that will require not only funding, but also patience, institutional capacity, and trust.

When aid turns into partnership

The Swiss model of Ukraine’s reconstruction illustrates a shift from one-off assistance to long-term strategic partnership. The focus on competitiveness, the private sector, and reforms creates conditions for Ukraine to become not merely a recipient of support, but an active participant in the European economic space.

In this sense, Switzerland’s engagement is an investment not only in Ukraine, but in the stability and economic security of Europe as a whole.

Sources

Länderprogramm Ukraine 2025–2028 (Phase I) – Swiss Federal Department of Foreign Affairs (EDA)

Ukraine Recovery Conference 2022 (Lugano) – Lugano Principles

Ukraine Recovery Conference 2024 (Berlin)

International Cooperation Strategy of Switzerland – Federal Council of Switzerland