Last week, the European Union summit addressed the issue of reparations credit for Ukraine. President Volodymyr Zelensky raised concerns about whether the measure would be approved on time, highlighting the country's urgent fiscal shortfall and the immediate need for financial support.
Experts clarified that 40% of Ukraine's budget consists of borrowed funds—projected 2024 revenues are 2.8 trillion UAH, while expenditures are 4.8 trillion UAH. To cover the gap, the government relies on international support: $45 billion for social payments and $60 billion for military aid. Some of these funds are covered by the Ukraine Facility credit program's remaining balance, but a substantial deficit remains.
The main sources of international assistance are European taxpayers' money and frozen Russian assets. Reliance on public funds has become politically challenging in some EU countries due to elections and government changes, so expectations center on the use of frozen Russian assets and the income they generate.
Partial credit secured by such Russian assets has already been implemented, but the larger reparations credit package—up to €140 billion over two years—remains unresolved. Belgium, as the main holder of assets in Euroclear, has outlined its conditions, as have other EU states.
The EU is expected to finalize the mechanisms for Ukrainian financing, credit sources, and shared responsibility by December. If approved at year's end, the first tranches may not be available until February, with January’s budget gap likely bridged by temporary reserves.
Overall, the situation remains challenging, but experts believe aid will be provided, as EU stability and security are also at stake.
