KYIV — Ukrainians can’t bear to think what will happen if they don’t get the aid that EU leaders have promised to approve this week. 

European heads of government are due to vote on a €50 billion aid facility for Kyiv on February 1. Without it, and a similar amount in funding due from the U.S., experts say Ukraine will not be able to keep fighting Russia, or sustain what remains of its battered economy, for long. 

“We are not currently even considering an option of not receiving this assistance,” Danylo Hetmantsev, head of the finance and tax committee of the Ukrainian parliament, told POLITICO. “It is critical for us, because the timeliness and completeness of non-military spending depends on it.” 

Kyiv currently uses what money it can raise domestically to run its own arms industry, pay its soldiers and other security personnel, and protect pensioners and the internally displaced. Western loans and grants cover outlays on the procurement and maintenance of foreign arms, as well as essential social сosts, such as salaries for public servants, and medical and educational workers. The government is planning for $37 billion in financial aid this year that would all-but cover a budget deficit estimated at $39 billion.

Western backers have provided some $73.6 billion in financial aid since Russia invaded in February 2022, according to calculations from the Center for Economic Strategy in Kyiv. Through the International Monetary Fund, they expect to provide a total of $122 billion between 2023-2027.  

But the flow of Western money has slowed to a trickle in recent months, as conflict in the Middle East, the onset of election year in the U.S. and a grinding economic slowdown have all pushed the biggest war in Europe in 80 years down the news agenda. So far this month, Ukraine has received no official financial aid at all. 

Hungarian Prime Minister Viktor Orban and Slovakia’s Robert Fico have both resisted providing any more aid to Ukraine from the EU budget, arguing that the funding should be divided into four tranches, each blockable at any time. Orban in particular is now facing increased pressure to drop his resistance. 

In the U.S., meanwhile, financial aid to Ukraine has become a hostage in the fight between Republicans and Democrats over border policy. Despite President Joe Biden’s support, House of Representatives Speaker Mike Johnson has demanded that the White House explain its end goal in Ukraine before voting on new aid to Kyiv.  

And while the fights in Washington and Brussels play out, Kyiv is holding its breath in silence, hoping not to hurt its chances of getting crucial support. 

The sinews of war are endless money

Not all officials are as downbeat as Hetmantsev. The country has accumulated over $40 billion of foreign exchange reserves and can point to improvements in tax collection and in its ability to raise money through domestic borrowing. 

“Ukraine will be able to sustain itself for some time at the expense of its own domestic resources,” Central Bank Governor Andriy Pyshnyy told POLITICO. “Although risks to the regularity and timeliness of international aid inflows have materialized, we remain optimistic.” 

But the harsh reality, said Maria Repko, deputy director of the Kyiv Centre for Economic Strategy, is that it is impossible to cover the non-military half of state spending from internal sources in a country at war, not least since Russia has "bitten off" a chunk of Ukraine that accounted for a quarter of its gross domestic product.  

GDP fell by 28 percent in the first year of the war, and recovered only a meager 5 percent last year, even with inflows of foreign aid equivalent to 20 percent of GDP.  

“If in 2023 we discussed other risks, such as a decrease in exports due to the closure of the Black Sea and the risks associated with the Russian offensive, all analysts agree now that the biggest risk this year is not getting aid,” Repko said, adding that the "what-if?" discussions have begun to circulate again in Kyiv. 

Without aid, and with international credit markets closed to it, the only way for Kyiv to keep honoring its domestic obligations will be to print money, Repko said.  

Even Pyshnyy acknowledges that failure to get the aid would mean “redistributing the Ukrainian economy’s limited resources toward priority budget needs.” As such, he said, it’s “critically important to have international funding restored.” 

One of Ukraine’s strongest arguments for continuing support remains that withholding it would, in the end, prove even more expensive for Europe. Ukraine’s defeat would require massive, long-term increases in military spending across the continent to contain a revanchist, neo-imperial Russia, they argue.

“Ukraine’s victory is key to easing security risks on the Continent,” Pyshnyy said, noting that the €50 billion package to be approved this week is small beer, relative to the overall European economy. 

“For them,” he said, “it could prove to be the best investment in their own defense and economies.”

Giovanna Coi contributed reporting.