Ukraine's 2027 budget has $32.6 billion uncovered financing need, finance minister says
Ukraine's Finance Minister Serhiy Marchenko said the country's 2027 budget faces an uncovered financing need of $32.6 billion — the tightest budget situation since the start of the full-scale Russian invasion in 2022. He called on European partners to seek additional sources of financing and presented a new proposal to redistribute roughly $300 billion in frozen Russian assets across all 27 EU member states.
Key points
- Finance Minister Serhiy Marchenko said Ukraine's 2027 budget has an uncovered financing need of $32.6 billion.
- Marchenko described the situation as the most tense since the start of the full-scale invasion in 2022.
- Marchenko said the $32.6 billion figure aligns with International Monetary Fund estimates.
- Ukraine is preparing the 2027 budget on the assumption that the war will continue through 2027.
- For 2026, Ukraine has confirmed $35 billion in external financing out of $45 billion needed.
- Ukraine has presented a new plan to shift responsibility for frozen Russian assets held in Belgium to shared responsibility among all 27 EU member states.
- The EU rejected a similar Ukrainian plan in December 2025 in favor of a joint €90 billion loan covering 2026–2027.
- At least 36 reform-related commitments under international programs have not been fulfilled on time.
Why it matters
The $32.6 billion uncovered financing need for 2027 marks the worst budget situation since the start of the full-scale invasion, and Marchenko's figure aligning with IMF estimates signals broad external recognition of the gap. Ukraine's reliance on a narrow set of funding channels — including the U.S. ERA program (funded by frozen Russian assets) and EU loans — creates exposure if any single source is disrupted, while the outlook for further U.S. support remains uncertain. The new proposal to redistribute roughly $300 billion in frozen Russian assets across all 27 EU member states would represent a structural shift in how those assets are managed at the EU level, with implications for legal risk and burden-sharing. Failure to deliver promised reforms tied to international financing could further delay disbursements and worsen the squeeze.
What happened
Finance Minister Serhiy Marchenko said Ukraine's 2027 budget faces an uncovered financing need of $32.6 billion, a figure he said aligns with IMF estimates and which he described as the tightest budget situation since the start of the full-scale Russian invasion in 2022. The 2027 budget is being prepared on the assumption that the war will continue through 2027. For 2026, Ukraine has confirmed $35 billion in external financing out of $45 billion needed, and Marchenko warned that ERA program funding may prove insufficient this year. Ukraine is presenting a new plan to shift responsibility for roughly $300 billion in frozen Russian assets currently held in Belgium to shared responsibility among all 27 EU member states, with new elements intended to reduce legal risks for the Belgian government and the Euroclear depository. The EU rejected a similar Ukrainian plan in December 2025 in favor of a joint €90 billion loan covering 2026–2027. Marchenko said the scope for increasing support within the existing EU budget is limited as the current Multiannual Financial Framework ends in 2027. He noted that delays in non-war-related payments would not affect external creditors, but consequences of the funding shortfall could be felt at the local level, particularly in shelter and infrastructure construction. Marchenko also stressed that delays in adopting legislation tied to international financing could postpone disbursements; at least 36 reform-related commitments under international programs have not been fulfilled on time. Budget committee chair Roksolana Pidlas said Ukraine must raise an additional $29.5 billion in international aid by year-end, and on September 2 reported that the state budget had received 33.1 billion hryvnias less in revenue than planned during January–August 2026. Prime Minister Serhiy Koretsky said on September 1 that the government is introducing a strict austerity regime for budget funds not earmarked for defense. On August 29, Defense Minister Yevheniy Khmara reported a $27 billion defense funding deficit, and on August 31 the 'Servant of the People' faction met with Koretsky, Marchenko and other officials to discuss the budget and international financing.
How Ukrainian sources describe it
Ukrainian coverage centers Marchenko's warnings about the tightest budget situation since 2022 and frames the funding gap as a direct consequence of intensified Russian attacks on logistics and critical infrastructure. The articles emphasize domestic political coordination, noting the August 31 meeting of the 'Servant of the People' faction with Prime Minister Koretsky and Finance Minister Marchenko, and the role of budget committee chair Roksolana Pidlas. Coverage also highlights at least 36 overdue reform commitments as a domestic factor that could further delay international disbursements.
Where reporting differs
The Ministry of Finance's estimate of the next year's budget deficit (€16 billion) and the National Bank of Ukraine's estimate of the external financing need ($12.7 billion) differ in metric and scope and are not directly reconciled in the reporting.
Background
The EU's current Multiannual Financial Framework ends in 2027, limiting room to increase support within the existing EU budget. In December 2025 the EU rejected an earlier Ukrainian plan regarding Russian assets in favor of a joint €90 billion loan decision covering 2026–2027. Ukraine is preparing the 2027 budget on the assumption that the war will continue through 2027. On August 29 Defense Minister Yevheniy Khmara reported a $27 billion defense funding deficit. On September 1 Prime Minister Serhiy Koretsky said the government is introducing a strict austerity regime for non-defense budget funds. On September 2 Roksolana Pidlas reported the state budget had received 33.1 billion hryvnias less in revenue than planned during January–August 2026.