The External Financing Plan for the 2026 State Budget Is Secured — Ministry of Finance
28 June 04:15
Securing external financing for Ukraine’s budget and its defense needs for this year and the coming years was the main objective of the Ministry of Finance delegation at the URC 2026 Conference on Ukraine’s Recovery in Gdańsk, according to "Komersant Ukrainian", citing “Interfax-Ukraine.”
“The year 2027 will require additional solutions. Ukraine is doing its part—mobilizing domestic revenues, expanding the tax base, and combating tax evasion and the shadow economy. But to maintain stability, we need continuous, predictable, and coordinated support from our partners,” emphasized Finance Minister Serhiy Marchenko one day before the official opening of the URC at the 17th meeting of the Steering Committee of the Ukrainian Donor Platform, which has 25 members, including 7 international financial organizations.
According to the minister, taking into account the ERA mechanism for utilizing frozen Russian assets, EU support under the Ukraine Facility and the new Ukraine Support Loan (USL), the IMF program, as well as assistance from Sweden, Norway, Japan, the World Bank, and other partners, Ukraine’s state budget needs for 2026 will be covered.
From the beginning of this year until the launch of the URC 2026, $11.9 billion has been raised. During the Conference, documents were signed for a new World Bank operation worth $3.39 billion—the Development Policy Operation (DPO-1 2026)—the largest in the history of the World Bank’s relations with Ukraine, with a grant component of $2.25 billion, and the first tranche of macro-financial support, amounting to EUR3.2 billion, was disbursed under the USL.
In addition, European Commission President Ursula von der Leyen announced that the first tranche from the USL for defense needs, amounting to EUR 5.9 billion, would be disbursed in the very near future, while Marchenko clarified that these funds will be accounted for as compensation for defense expenditures from the budget that were made earlier this year.
“At the same time, funding for 2027 is not yet fully secured, so further coordination among donors remains necessary,” the Ministry of Finance emphasized.
Among other things, Marchenko once again called on partners to step up efforts to confiscate frozen Russian assets directly, rather than just the income generated from them, which would serve not only as an act of justice but also as a significant financial resource for reconstruction.
Watch us on YouTube: important topics – without censorship
In total, since the start of the full-scale invasion, Ukraine has attracted nearly $180 billion in external financing, according to the Ministry of Finance, and according to the Budget Declaration for 2027–2029, approved by the government last week, the total need for external financing in 2026–2029 amounts to $145.9 billion.
According to the Interfax-Ukraine news agency, this involves securing approximately $20 billion in as-yet-uncovered external budget financing for next year and roughly the same amount for defense funding this year to ensure the announced increase in military pay.
In an interview with “Suspilne” on the sidelines of URC 2026, Marchenko clarified that this pay reform will require an additional 65 billion hryvnia this year and 130 billion hryvnia next year.
The minister also emphasized that during the first five months of 2026, Ukraine demonstrated a satisfactory level of domestic budget revenues. In particular, this positive trend was driven by higher-than-expected corporate income tax revenues—primarily thanks to the banking sector—as well as personal income tax revenues, notably due to increased collections from the military levy.
Separately, Marchenko highlighted the role of the domestic government bond market, which remains an important source of budget financing and confirms the trust of citizens and businesses in the state.
On the sidelines of the URC, the Minister of Finance held meetings with Dan Katz, First Deputy Managing Director of the International Monetary Fund; Ajay Banga, President of the World Bank Group; Anna Bjerde, World Bank Managing Director for Operations; Alfonso García Mora, Vice President of the International Finance Corporation (IFC) for Europe, Latin America, and the Caribbean; Carlo Monticelli, Head of the Council of Europe Development Bank (CEB), Rachel Reeves, UK Chancellor of the Exchequer, and Kristupas Vaiteikūnas, Minister of Finance of Lithuania.
Marchenko noted that Ukraine and the IMF recently reached an agreement at the expert level on the first review of the new $8.1 billion EFF program, which paves the way for receiving the second tranche of approximately $690 million following approval by the IMF’s Executive Board. In preparation for this review, which is expected in the first half of July, the minister has already signed, on his part, a Letter of Intent and an updated Memorandum on Economic and Financial Policies, which will be sent to the Fund in the coming days after being signed by other Ukrainian representatives.
Following the meetings, the parties reaffirmed their shared commitment to further strengthening Ukraine’s financial resilience, continuing reforms, and deepening international coordination to ensure the country’s economic stability amid the war and accelerate its recovery.
The parties also discussed the new Development Policy Operation (DPO-1 2026), approved by the World Bank’s Board of Directors on June 22, 2026. Its implementation will provide 3.35 billion U.S. dollars in funding for Ukraine’s state budget, of which 1 billion U.S. dollars is a DPO loan and 2.35 billion U.S. dollars is an additional grant.
During a meeting with IMF First Deputy Managing Director Dan Katz, the parties discussed the implementation of a new four-year Extended Fund Facility (EFF) program worth $8.1 billion.
Read us on Telegram: important topics – without censorship
