Following this year’s amendments to the state budget, Ukraine’s planned deficit will reach $42 billion based on the budget's estimated exchange rate — and there is no reason to expect a decrease in 2025, according to a government report.
As a result, the need for external financing will remain high, close to or even exceeding $40 billion.
Committee Chairwoman Roksolana Pidlasa said the deficit will be partially covered by so-called non-repayable G7 loans (ERA loans) and partially through European Union assistance under the Ukraine Facility.
However, Ukraine still faces an unmet external financing need of $19 billion in 2026.
Pidlasa emphasized that with 66% of Ukraine’s budget directed toward defense, securing funding should not fall solely on the Ukrainian government or the European Commission.
“I see the potential for deepening and expanding cooperation with the IMF, following the example of other countries,” she said. “In 2025, the IMF agreed on a cooperation program with Argentina worth $20 billion, of which $12 billion was an initial disbursement without structural benchmarks. Meanwhile, Ukraine underwent eight successful reviews to receive $6.19 billion.”
On July 16, the Verkhovna Rada adopted in the first reading draft law No. 13439-3, which proposes amendments to the 2025 state budget concerning financial support for the security and defense sector and other priority needs. The bill was backed by 257 lawmakers.
The legislation provides for an increase in defense and security spending of over 400 billion hryvnias. Of the 450 billion UAH proposed by the government, 412.5 billion will go toward defense, including nearly 216 billion UAH earmarked for weapons and equipment procurement.
The increase in general fund expenditures will be allocated among the Ministry of Defense (311 billion UAH), the Ministry of Internal Affairs (84 billion UAH), the Main Intelligence Directorate (4.5 billion UAH), the Security Service of Ukraine (1.6 billion UAH), the State Security Directorate (0.5 billion UAH), and the State Special Communications Service (0.06 billion UAH). Remaining funds will be directed to a special fund.
An additional 26 billion UAH was allocated to the budget’s reserve fund for urgent and unforeseen needs, and 15.5 billion UAH was earmarked for the Ministry of Digital Transformation, the Ministry of Education and Science, and the Ministry of Health.
The total proposed increase in 2025 state budget expenditures amounts to 457 billion hryvnias.
At the same time, the government detailed how nearly 2 trillion UAH was spent from the budget in the first six months of the year.