Ukraine has adequate funding this year, but challenges regarding the 2026 budget are increasing, according to RRR4U monitoring.

Ukraine is demonstrating significant progress in fulfilling its commitments to international donors; however, adherence to the timeline for their implementation is deteriorating, which could lead to delays in funding.

This is evident from the data of Monitoring RRR4U.

"We have reached a historic high as we successfully completed the sixth review of the IMF Program. Ukraine has not progressed this far before. This indicates a certain level of effectiveness in completing our homework. However, the question remains: what’s next, as Ukraine has not met two structural benchmarks required for the seventh review. The program has already been executed at 63% in terms of funding volume. In the coming years, we will receive less funding. By 2025, the maximum we can receive is $2.7 billion, provided we meet all benchmarks. We are facing a challenging seventh review in March, as we have not canceled the 'Lozovoy amendments' and have not established the Higher Administrative Court. These structural benchmarks have already been postponed several times," said Yuriy Romashko, Executive Director of the Institute of Analytics and Advocacy.

As a result of the review, three new structural benchmarks have been added: an operational strategy for the securities market regulator, minimizing operational risks for financial institutions, and assessing the activities of the NKREKP. At the same time, Ukraine has not fulfilled two commitments, the deadlines for which expired on December 31.

Regarding the Ukraine Facility, experts did not identify any unmet commitments, although certain difficulties were encountered. According to Alona Korogod, a project expert at DiXi Group, in 2024, Ukraine successfully handled its homework and was able to secure €16.1 billion for the budget. In 2025, if the stipulated indicators are met, Ukraine could receive €12.5 billion.

After fulfilling the indicators for the third quarter, the European Commission disbursed a tranche of €4.1 billion only in mid-December. Due to the lack of a mechanism for partial payments for completed indicators, Ukraine received the entire amount despite delays in fulfilling indicator 4.4.

Funding from the EU and IMF is not the only source of Western budget support.

"2025 is primarily about the ERA funding mechanism. This is the $50 billion that Ukraine will receive from G7 countries through revenues from frozen Russian assets. This year, ERA will cover a significant portion of our funding needs. Despite all the geopolitical and military challenges facing Ukraine, from a budgetary perspective, we are entering the year in a more stable position than in 2024," explained Maxim Samoylyuk, an economist at the Center for Economic Strategy.

Ukraine requires $38 billion in funding in 2025, of which $2.7 billion is expected from the IMF, $13.1 billion from the EU under the Ukraine Facility, and the remaining $22.2 billion will be primarily covered through the ERA mechanism.

Olexandra Betliy, a leading researcher at the Institute of Economic Research and Political Consulting, believes that significant funding hinders making tough decisions. In her view, there is a risk that it will be more challenging to make important decisions regarding both the IMF and the Ukraine Facility precisely because "we do not critically need the money." However, without funds and an active IMF program that Ukraine is executing, obtaining financing for 2026 will be very difficult.

Background. Previously, Mind reported that the Cabinet of Ministers approved the Strategy for the Development of Border Infrastructure with the European Union and Moldova until 2030, as well as the Strategy for Reforming Psychoneurological and Other Boarding Institutions until 2034. These two strategic documents are steps in Ukraine's plan under the Ukraine Facility financial assistance program.