The European Union will not fast-track Ukraine Facility funding scheduled for 2027
Ukraine has secured financial resources to cover its state budget deficit for the current year. The shortfall will be addressed through internal reallocation of funds and a reduction in weapons procurement spending. This was reported by RBC-Ukraine (Мілан Лєліч) citing European Commission, according to the portal PromPolitInform.
The European Commission concluded that there is no deficit in Ukraine’s budget following consultations with Ukrainian diplomats. EU officials noted they had never claimed a financial gap existed, having only referred to prior reports.
The EU reminded that funds under the Ukraine Facility program remain available for disbursement this year. To receive them, Ukraine must meet the agreed conditions and implement planned reforms. However, the EU ruled out early disbursement of funds allocated for 2027.
Deficit coverage mechanism
To resolve the financial issue, Ukrainian authorities will utilize domestic resources. In addition to reallocating budget funds, part of the financing will be secured by cutting expenditures on arms procurement. This will allow the government to fully balance this year’s budget.
An alternative solution has been found regarding the European support planned for 2027. Since the EU cannot transfer these payments to the current year, an agreement was reached with weapons manufacturers.
Defense companies will start production as needed, while European partners will shift the payment schedule. All settlements with the manufacturers are planned to be completed in the first days of next January.
Decisions of Parliament and Cabinet
The final resolution of the budget deficit depends on the vote in the Verkhovna Rada. The parliament must approve a portion of the decisions related to the reallocation of state funds.
Earlier, the state leadership pointed to a significant shortage of financial resources. Due to delays in foreign aid, the Cabinet of Ministers of Ukraine adjusted the priority of expenditures.
The government temporarily suspended funding for non-essential needs. In particular, restrictions affected capital repairs, new construction, reconstruction of facilities, as well as landscaping, park renovations, and cobblestone replacement.
Illustrative photo: Jai79 / CC0
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