HANetf co-CEO Hector McNeil discussed the investment case behind the Ukraine Reconstruction UCITS ETF (LSE:KYIV, LSE:UKRN, XETRA:UKRN) in an interview with Proactive.
The exchange-traded fund is designed to capture what could become a $500 billion-plus rebuilding effort spanning infrastructure, energy and defence.
Below is a transcript of the conversation, covering the structure of the ETF and the potential return profile.
Proactive: I'm joined by Hector McNeil, the co-CEO of HANetf. We're talking about the Ukraine Reconstruction UCITS ETF. Hector, good to speak with you again. The cost of reconstruction and recovery for Ukraine is estimated at $524 billion over the next decade. How does an investor actually get exposure to that opportunity through a single ETF?
Hector McNeil: It's one of the proudest ETFs I've been involved in. While it may not seem like an obvious area for immediate demand, peace could come quickly. There was even a recent ceasefire attempt. The $500-600 billion expected to flow into Ukraine will support a country of over 40 million people and position it as a key buffer between the West and Russia.
Ukraine is already highly tech-driven, and sectors like defense, infrastructure, energy, industrial resilience, and transport will require massive investment. This will resemble a “mini Marshall plan,” similar to post-war rebuilding in Europe and Japan.
The Ukraine Reconstruction ETF (UKRN) provides exposure by investing in global companies contributing to four pillars: industrial resilience, infrastructure, energy, and defense. It also includes a fast-track mechanism to add Ukrainian companies, even those newly listed across European or US exchanges, or domestically when markets reopen.
Proactive: If peace does come along and reconstruction accelerates, what does that return profile look like? Is this a short-term trade or a long-term opportunity?
Hector McNeil: It’s both. There could be an initial surge as companies compete for contracts, alongside a long-term structural story driven by infrastructure and energy projects that span decades.
There’s also significant effort toward anti-corruption and transparency in investment processes. The multiplier effect of reconstruction spending could further boost economic growth and attract additional capital.
Ukraine is in a strong geopolitical position, with growing global demand for its expertise. Importantly, waiting for peace may mean missing the opportunity, as markets will likely price it in early.
The ETF also allows Ukrainian companies from any sector to be included, not just the four pillars, reflecting the belief that all domestic businesses will contribute to reconstruction.
Proactive: Thank you for your time.