We do not want a frozen conflict in Ukraine

LONDON — A ceasefire in Ukraine is not enough for European officials, who want lasting peace in the region, European Commission President Ursula von der Leyen told CNBC.

“We are very clear we do not want only a ceasefire and a frozen conflict in regions of Ukraine, because these regions will always be fragile. No investment will go there, and the conflict could [at] any time flare up again, as we have learned since 2014. So it has to be a real peace,” von der Leyen said on the sidelines of a conference on reconstruction efforts for Ukraine.

Kyiv has been fighting a Russian attempt to fully invade the nation since February 2022. Territorial tensions with Moscow go back to 2014, when Russia illegally annexed Crimea — which Kyiv considers part of Ukraine.

Ukraine is in the early stages of its counteroffensive to recapture Russian-occupied territory in the south and east of the country. Military analysts argued that Kyiv is making small gains.

Peace talks seem to be elusive for the time being, with western officials skeptical of the success prospects of international propositions, such as the 12-point plan unveiled by Russia’s major trade partner China on the first-year anniversary of the conflict.

Beijing’s plan did not condemn Russia for its invasion, and it did not include Kyiv’s aim to regain Crimea.

Speaking to CNBC’s Steve Sedgwick, von der Leyen said that China can nevertheless be a crucial player in the peace process.

“China is a permanent member of the UN, and this comes with responsibility. And China has influence on Russia, so we expect China to use this influence to convince Russia to sit down at the negotiating table,” she said.

Her comments come as western governments seem to be stepping up their efforts for the future reconstruction of Ukraine. UK Prime Minister Rishi Sunak on Wednesday announced loan guarantees worth $3 billion over three years at the conference. The European Union on Tuesday said it would provide Ukraine with 50 billion euros ($54.58 billion) of aid between 2024 and 2027.

Von der Leyen said the two-day meeting in London was about governments coordinating their aid to Kyiv, but also about convincing private investors to join in.

“It is getting the private sector to chip in,” she said, “We need that knowledge, we need that expertise and, of course, the financial firepower.”

Data from the World Bank and the European Commission released in March said that the cost of reconstruction in Ukraine would be about $411 billion. However, that number preceded the devastating collapse of the Nova Kakhovka dam and ensuing floods earlier this month, and the cost only increases as the war drags on.