Key facts
- Ukraine faces a $27 billion defense funding gap this year.
- Kyiv hopes to cover $7 billion domestically and seeks international partners for the remainder.
- Russia launched over 190 missiles and drones in a recent nationwide assault.
- The Russian military has reportedly suffered over 1.5 million casualties.
- Russia plans to spend 17.1 trillion rubles ($180 billion) on defense in 2027.
- The EU has €37 billion available for Ukraine in the current calendar year, pending reforms.
Ukraine is facing a critical defense funding shortfall of $27 billion this year, according to Prime Minister Sergii Koretskyi, as Russia intensifies its aerial assaults on the country's infrastructure. Kyiv is seeking substantial financial aid from international partners to cover the majority of this gap, while also considering domestic tax increases to bolster its war chest.
Koretskyi warned that without adequate funding, Ukraine's ability to resist Russia would be undermined, emphasizing the urgent need for cash to place advance orders for weapons and ammunition for the following year, particularly long-range drones. He indicated that the government would implement strict austerity measures and defer non-priority expenditures to ensure payments for military personnel, pensions, social services, and public sector salaries.
Russia has escalated its drone and missile attacks, heavily targeting energy infrastructure and causing widespread blackouts, including in Kyiv. President Volodymyr Zelenskyy has reiterated his plea to allies for more air defense systems, stressing their life-saving importance as winter approaches. The relentless strikes have impacted railways, energy plants, ports, and factories, straining Ukraine's economy and public finances.
Despite the financial strain, Ukraine continues to inflict costs on Russia. The Ukrainian army reported pushing back Russian forces and capturing prisoners on the eastern front, and Kyiv is investing in domestic long-range missiles and drones to strike targets within Russia. However, the ongoing war effort is heavily reliant on external funding.
European allies, who provide the bulk of Ukraine's weapons and finances after the U.S. reduced new aid, are under pressure to increase their support. The EU is disbursing installments of a €90 billion loan, but Ukraine is requesting faster access to funds. Brussels, however, is linking further budget support to the completion of crucial reforms by Ukraine's parliament, as part of its roadmap to EU membership. European Commission President Ursula von der Leyen noted that €37 billion remains available this calendar year, dependent on reform progress.