Ukraine’s Zelensky plans ‘difficult’ measures to cut budget deficit

Ukraine's President Volodymyr Zelensky floated seven unspecified draft laws which he said were “needed to finance the state budget deficit”.

KYIV - Ukraine’s President Volodymyr Zelensky on Sept 15 said he planned to take difficult and unpopular decisions to plug the country’s yawning budget deficit.

The deficit is weighed down in particular by a €23 billion (S$33.79 billion) gap in military spending.

Zelensky floated seven unspecified draft laws which he said were “needed to finance the state budget deficit”.

“Some things may be difficult, may be unpleasant and unpopular. But right now, without these things, it is impossible to ensure the full needs of our defence and the resilience of Ukraine,” he added in his daily address to the nation on social media.

“The deficit must be covered. These are billions of dollars that positive votes can bring to Ukraine.”

Ukraine, which relies largely on financial support from its Western allies to fight Russia and fund its spending, is facing a worsening economic situation.

In recent months, both sides have increased their use of long-range missiles to strike inside the other’s territory, which in Ukraine’s case has eaten up funds meant for use in the second half of 2026.

Russian strikes have severely hit the metallurgy sector and agricultural exports, which are both essential to the Ukrainian economy.

According to Roksana Pidlassa, chair of Ukraine’s parliamentary budget committee, each day of war costs around US$190 million (S$241.95 million) – and the country cannot cover the costs on its own.

Zelensky told European leaders in Kyiv in August that Ukraine needed “a lot more” money.

European countries have already agreed at the end of 2025 to grant a €90 billion loan to Ukraine for 2026 and 2027 to cover its existing military and civilian budget deficit.

In all, Ukraine has received more than €230 billion from European countries and nearly US$130 billion from the United States since Russia’s full-scale invasion in 2022.

According to Germany’s Kiel Institute, it is set to receive a further €160 billion in the future. AFP