Almost $700 million for Ukraine’s budget: what the government’s new decision entails
23 January 19:43
The Cabinet of Ministers of Ukraine has approved the allocation of $690.79 million in budget support from the International Bank for Reconstruction and Development (IBRD) and the International Development Association. The relevant order was published on the Government portal, reports "Komersant Ukrainian".
The funding is being raised within the framework of international support mechanisms for Ukraine and is being directed directly to the general fund of the state budget, which allows for the coverage of current state expenditures in the context of the war.
How the funding is structured
According to the document, the package consists of several components.
A small portion of the funds — $793,350 — is provided in the form of a direct grant in accordance with the grant agreement between Ukraine, the IBRD, and the International Development Association.
The main amount — $690 million — is raised through a mechanism of contingent liabilities, which are formalized within the framework of cooperation with individual partner countries but administered through World Bank structures.
Where the funds come from
Part of the funding, amounting to $146 million (equivalent to 200 million Canadian dollars), is linked to a loan provided by Canada.
The largest component — $544 million (equivalent to 85 billion Japanese yen) — is raised in accordance with an agreement between the governments of Ukraine and Japan signed in April 2025.
A key feature of this mechanism is that the loan will not be repaid or serviced from Ukraine’s state budget. The costs will be covered by alternative sources, including income from frozen Russian assets.
What is the significance of such instruments for the budget?
Such instruments allow Ukraine to receive significant amounts of external financing without a direct debt burden on the budget in the short term.
Similar solutions are already being applied within the framework of broader agreements with G7 partners on the use of proceeds from frozen Russian assets to support Ukraine.
Earlier, Ukraine and Japan signed a separate agreement to provide Kyiv with a loan of up to 471.9 billion yen (about $3 billion), which also provides for repayment from the proceeds of frozen Russian assets.
