The Cabinet of Ministers of Ukraine has decided to allow the Ministry of Finance to raise additional loans of up to ₴55 billion beyond the approved borrowing plan for the current year. These funds may be obtained from the European Union, international financial organizations, or through the issuance of domestic government bonds (OVDP).
This is reported by Business • Media
Reasons for the Government’s Decision
The government emphasized that obtaining external financial assistance is currently complicated, leading to delays in the approval of financial packages. This increases the risks of untimely fund inflows and creates additional difficulties in financing critically important state budget expenditures. The Ministry of Finance explained that forming a reserve budget surplus is necessary to maintain solvency and liquidity at the beginning of the new financial year.
“The formation of a reserve budget surplus will help ensure liquidity and solvency at the beginning of the next budget period,” the Ministry of Finance explained.
Risks for the Social Sector and Defense
The head of the Budget Committee of the Verkhovna Rada, Roksolana Pidlasa, emphasized that without additional external support, Ukraine will lack funds to finance social expenditures starting from April 1, 2026. According to her, the state needs $45.5 billion to fully cover humanitarian and social expenses.
The British publication The Telegraph notes that a deficit of €55 billion for 2026–2027 threatens Ukraine’s future and could impact the course of the war with Russia. If Kyiv does not receive an EU loan secured by frozen Russian assets, the country may find itself without the necessary resources by spring, which would negatively affect its defense capabilities. At the same time, obtaining reparations loans with the possibility of directing them to military needs could compel Moscow to begin negotiations to end the war.
Ukrainian President Volodymyr Zelensky emphasized that if funds from the reparations loan do not arrive by spring 2026, Ukraine’s production of drones for the front will significantly decrease, making it impossible to carry out long-range strikes on Russia’s energy infrastructure.