Ukraine facing military funding gap – budget boss
Ukraine is running out of money to finance its conflict with Russia and may need to amend this year’s budget to increase military spending, the chair of the country's budget committee has warned.
Kiev spends about 60% of its budget on the conflict and depends on Western aid for military needs and to cover pensions, wages, services, debt, and humanitarian costs. The expenditure is currently backed by a $15.5 billion IMF loan agreed in 2023 and a G7 program tied to profits from frozen Russian assets.
In a Facebook post on Tuesday, Budget Committee chair Roksolana Pidlasa said Kiev still needs $8.7 billion from Western donors to cover the $39.3 billion in external financing required for Ukraine’s 2025 budget, warning the shortfall could grow by the end of the year to keep the army running.
“There’s a possibility of new changes to the 2025 budget in the fall to increase spending on the national security and defense sector,” Pidlasa admitted, without specifying an amount. She stressed that before any changes could be made, Kiev must reach an agreement with the EU on using its share of the G7 loans for the military.
Western states froze about $300 billion in Russian sovereign assets in 2022, with some €200 billion ($209 billion) held at EU clearinghouse Euroclear. Brussels last year backed the G7 plan to use the interest these funds accrued to secure $50 billion in loans for Ukraine, pledging $21 billion. However, the loan program is intended to finance essential state functions and reconstruction, not Kiev’s war effort.
Earlier this month, Kiev sought a new four-year IMF funding plan, estimating it would need up to $37.5 billion over the next two years if hostilities continue. However, according to media reports, the IMF believes Ukraine should seek to borrow almost double that sum in order to offset risks to its financial sustainability. The program, however, also can’t be used directly for military spending.
Pidlasa added that Kiev faces an “unmet need for foreign aid” of $18.1 billion in 2026. She did not specify whether agreements exist to cover the gap.
Moscow has warned that Western aid only prolongs the conflict and has denounced the freezing of its assets as “robbery” that violates international law and erodes trust in the global financial system.
