Ukrainian Prime Minister Serhiy Koretsky has warned that Ukraine could face large-scale budget cuts if it fails to secure further Western financial assistance, Bloomberg reported.
According to Koretsky, Ukraine has already missed out on roughly $4 billion promised by the European Union because the Verkhovna Rada, Ukraine's parliament, has refused to back reforms demanded by the European Union and the International Monetary Fund (IMF). At the same time, Kyiv has acknowledged that rising military spending means it will need an additional $27 billion for defense this year.
Koretsky said this showed a lack of understanding of the scale of the problem, adding that the budget was inelastic.
Donor demands on Kyiv
Ukraine's largest donors are demanding that Kyiv take steps to shrink the shadow economy, boost tax revenue, and bring its legislation into line with EU standards. If Ukraine misses the deadlines for passing these laws, it risks losing a significant share of $29.5 billion in international financing, according to the report.
Koretsky called on international partners to reduce uncertainty around financing by taking on medium- and long-term financial commitments to Ukraine.
Zelensky presses the EU on payments
President Volodymyr Zelensky earlier called on the EU to speed up disbursements from a loan of 90 billion euros ($104 billion) allocated for next year, citing mounting budget difficulties. The request raised questions among Ukraine's Western allies.
The loan forms part of the wider package of Western financial support, alongside aid from the IMF and individual donor governments, that has helped keep Ukraine's government funded since Russia's full-scale invasion. Kyiv has relied heavily on such external financing to cover its budget shortfall.
A widening deficit
Ukraine has run its state budget with a record deficit for several years running. Planned spending this year is set to exceed revenue by 1.9 trillion hryvnia, or about $45 billion. The shortfall is expected to widen further in 2027, reaching 2.04 trillion hryvnia.
Rada deputy Dmytro Razumkov warned that without Western assistance, Ukraine's money would last only until mid-April of next year.
