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'No one will like it' if EU doesn't boost Ukraine's aid in 2024, Ukrainian official warns

'No one will like it' if EU doesn't boost Ukraine's aid in 2024, Ukrainian official warns Roksolana Pidlasa (photo: Vitalii Nosach, RBC-Ukraine)

Funding for government programs is to be cut if the European Union does not agree to increase funding for Ukraine's state budget for 2024 from €9 billion to €18 billion, states Roksolana Pidlasa, the Head of the Verkhovna Rada Budget Committee, in her interview with RBC-Ukraine.

"No one will like what's going to happen if there is not enough funding. In this case, programs that can be abandoned will be cut first," she said.

In this case, according to Pidlasa, funding cuts may affect business support programs, capital expenditures may be reduced, and it may be necessary to continue redistributing taxes to the state budget.

"We will continue discussions on the redistribution of taxes from local budgets to the state budget. We have almost no recovery anyway," she said.

Budget plan for 2024

According to Pidlasa, the need for international financing for 2024 is $41 billion.

"Now there is a question of support from the EU. According to the Ukraine Facility plan, out of 50 billion euros, direct budgetary assistance is 39 billion euros for 4 years. If we divide these funds into equal parts, we get 9.75 billion euros per year. This is obviously not enough for us next year, so the government and the Ministry of Finance in particular are negotiating to get 16-18 billion euros out of these 39 billion next year," she said.

According to her, the United States should allocate $8.5 billion for the next year. "If we do not receive another $3.3 billion in funding from the United States this year, we hope that they will move on to the next year and increase the total amount to $11.8 billion. At least we would really like it to be that way, and we are working on this issue as well," Pidlasa said.

She noted that "we will definitely get $5.4 billion from the IMF if we fulfill all the conditions." Funding from the G7 governments is tied to the IMF. Canada intends to allocate $1.9 billion, Japan - $4.5 billion. "There will be guarantees from the British for $1 billion, as well as project financing (World Bank and EIB - ed.) for $1.5 billion in a special fund," Pidlasa added.

Financing Ukraine's needs during the war

According to the National Bank of Ukraine, the amount of financial support this year will exceed $45 billion, of which more than $35 billion has already been received as of the end of October (including $24.3 billion in loans).

In 2024-2025, official funding will remain significant, although it will gradually decrease to $38.5 billion and $25.0 billion, respectively.