Ukraine secures desperately needed funds from World Bank

With US and EU funding delayed, Kyiv said the money would stabilise its economy as it continues to repel Russian attacks.

Two people collect wood in the snow next to a damaged building
Valentina Anatolevna and Tatyana Mikhailovna wait to pick up wood to heat their homes outside a courthouse that was destroyed by an air strike in the front-line town of Lyman, amid Russia's attack on Ukraine [File:Thomas Peter/Reuters]

Ukraine has received a vital $1.34bn in funds from the World Bank.

The funding has been paid out to support non-security related financial and economic stability, Ukraine’s Ministry of Finance said on Monday. The cash boost will be welcomed by Kyiv, which warns that its ability to defend against the Russian invasion could soon be impacted by delays in funding from the United States and the European Union.

In a statement, the ministry noted that the financing, which is the Sixth Additional Financing under its Public Expenditures for Administrative Capacity Endurance in Ukraine (PEACE) project, consisted of a $1.086bn loan from the World Bank, a $190m grant from Norway, a $50m grant from the United States and a $20m grant from Switzerland.

The funds are expected to be used to partially compensate for non-security and defence-related expenditures of the Ukrainian state budget, including old-age social payments and payments to employees of the state emergency service, the ministry added.

“International financial assistance is a significant contribution to maintaining Ukraine’s financial and economic stability and allows us to provide priority social expenditures during the war,” said Ukrainian Finance Minister Serhiy Marchenko.

“Since the beginning of the full-scale invasion, the governments of Japan, the United States, Norway and Switzerland have repeatedly demonstrated their unwavering support and solidarity for Ukraine. I am grateful to our partners for their willingness to cooperate and help us at a crucial time for Ukraine.”

Funding difficulties for Ukraine

It has been nearly two years since Russia invaded Ukraine, and as the war continues to rage uncertainty is growing over Western backing for Ukraine.

Earlier this month, the White House warned the United States Congress that funds designated for providing aid to Ukraine would run out by the end of the year, amid Russia’s intensifying campaign to knock out the country’s energy infrastructure.

The US, Ukraine’s biggest single-country donor, has sent more than $40bn in aid since Russia’s invasion in February 2022. But right-wing congressional Republicans have expressed increasing scepticism towards approving more funds for Ukraine.

The United States Senate has said they will vote on an aid package for Ukraine in 2024. But Congress could continue to hold up the money.

The impasse over US aid to Kyiv is mirrored in the European Union, where Hungary is blocking a 50 billion euro ($55bn) aid package. The bloc is due to revisit the issue in January.

The difficulties in securing the funds in Washington and Brussels have raised concerns in Kyiv that Western backers are experiencing “fatigue” with the drawn-out battle, as fighting on the front line becomes bogged down.

Ukrainian President Volodymyr Zelenskyy has noted that Kyiv’s “foreign policy will be active” with many international activities in January.

“We make every effort to strengthen Ukraine and ensure that everyone is confident about the coming year, about military aid, macro-financial assistance, and political support,” he said.

Drone attacks continue

Russian attacks against Ukraine continued over Christmas.

On Monday, the Ukrainian military said that Russia launched 31 drones and two missiles from the annexed Crimean Peninsula overnight.

The military said the attack mostly targeted the south of Ukraine. Kyiv’s air defences “destroyed 28 Shahed attack drones in Odesa, Kherson, Mykolaiv, Donetsk, Kirovohrad and Khmelnytskyi regions” and also destroyed the missiles, it said.

Meanwhile, Russian-installed authorities reported one person killed in Ukrainian shelling of the Russian-occupied eastern town of Horlivka.

The latest assaults come as Ukraine marks Christmas on December 25 for the first time, after President Volodymyr Zelenskyy signed a law moving the celebration from the January 7 date observed by the Russian Orthodox Church.

In an address to mark Christmas Eve, Zelenskyy assured Ukrainians fighting against Russia that “step by step, day by day, the darkness is losing”.

“Today, this is our common goal, our common dream. And this is precisely what our common prayer is for today. For our freedom. For our victory. For our Ukraine.”

Source: News Agencies