9 Aug 2023 18:01

Ukraine will need at least $42 bln in external financing in 2024

MOSCOW. Aug 9 (Interfax) - Ukraine will need at least $42 billion in external financing in 2024, which is no lower than in 2023, as the next year's defense and security spending will be kept at the same level, Ukrainian media quoted Finance Minister Sergei Marchenko as saying in an interview with Radio Liberty, which is recognized as a foreign agent in Russia.

"Now we need $42 billion in external financing. The amount we plan for the next year is no smaller. Why? This is because we will plan the budget of the security and defense sector at the level of 2023," he said.

As of now, defense and security expenditures for 2024 are estimated at 1.6 trillion grivny per year, while the tax revenue amounts to 1.3 trillion grivny, Marchenko said.

External funding for 2023 is secured, while there are no guarantees that it will be provided in the required amount in 2024, he said.

"As for 2024, there is so far an understanding only that we have assistance from the EU 50 billion euros in four years. There is the [International Monetary Fund] IMF, which helps us to raise these commitments. I hope there will be the United States. I very much hope so. It is very important. This is because the U.S. gives us grants. But this is not for sure," Marchenko said.

It was reported earlier, the National Bank of Ukraine in late July adjusted budget needs forecast upward to $37 billion due to the deterioration of the consolidated budget deficit forecast (excluding grants) to 20% of GDP, and including grants to 1.28 trillion grivny, or 16.8% of GDP, compared to 0.81 trillion grivny, or 10.5% of GDP in its April report.

According to the Ukrainian Finance Ministry, as of August 7, Ukraine's state budget received $28.1 billion in funding from international partners, compared to $32.1 billion in 202, while the 2023 needs stand at about $42 billion.

The largest sources of financing are the EU macrofinancial loan of $11.4 billion and U.S. grants worth $8.5 billion, as well as a $3.59 billion loan under the IMF Extended Fund Facility.