Ukraine could spend $65 billion on defense in 2023, representing 37% of the country’s economic output, while Russia provided $109 billion to support its own.
Assistance from the United States, combined with commitments from other countries, should provide Ukraine until about the end of 2025, but Kyiv needs long-term funding. Reuters reports this.
The agency notes that a financing plan is needed to withstand the onslaught of Russia. Mobilizing the frozen assets of Moscow’s central bank to compensate for the damage caused by the war should be a central element of this plan.
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Journalists believe that a multi-year financing plan, on the contrary, would have several advantages. First of all, it would provide some insurance against political fluctuations in the United States. It would also boost Ukrainian morale and give Western arms manufacturers more confidence to ramp up production.
Ukraine is straining to hold the line against Russia, an adversary whose $2 trillion economy is 11 times larger than its own last year. Even though Ukraine spent $65 billion on defense in 2023, representing 37% of the country’s economic output, that spending dwarfs the $109 billion spent by Russia, according to the Stockholm International Peace Research Institute (SIPRI).
How much Kyiv will need in the future depends on what kind of war it is fighting. A defense campaign will cost less than trying to expel Russia from territories that have been occupied. With the Kremlin ramping up its own military spending, Ukraine will likely need at least as much annually in the future as the 88 billion euros the allies have pledged in 2023.
As of late February, Ukraine’s allies – mainly the European Union – had pledged but not yet committed 103 billion euros, according to the Kiel Institute. Add to this the US package equivalent to 57 billion euros, and Kyiv will likely have enough aid to last until the end of 2025.
Let us recall that on April 26, some American legislators said that the allocated funds would be enough for Kyiv until the end of November this year, and providing additional money is simply impossible. Although there is another option – to get help on credit. They believe that towards the end of this year the question of allocating new funds for Ukraine will arise. At the same time, some Republican congressmen say that the package of American aid to Kyiv adopted this week will be the last.
