Skip to content

G7 Support Boosts Ukraine's Confidence for Longer War with Russia

Ukraine has received a new international economic support package of $115 billion, bolstering its confidence in battling Russia's invasion. Speaking on Saturday, Ukrainian Finance Minister Serhiy Marchenko acknowledged the growing recognition that the war could last longer than anticipated.

Serhiy Marchenko, Ukrainian Finance Minister
Serhiy Marchenko, Ukrainian Finance Minister

G7 Finance Ministers Pledge Long-term Support for Ukraine

During this week's International Monetary Fund and World Bank meetings in Washington, G7 finance ministers assured Marchenko of their support for Ukraine as long as necessary. This marks a shift from last year when there was more pressure on Ukraine to end the war.

$15.6 Billion IMF Loan Unlocks Economic Support

A new four-year, $15.6 billion IMF loan has unlocked crucial economic support for Ukraine, now in its second year of war following Russia's invasion in February 2022. This funding certainty is "tremendously" important, according to Marchenko, who feels more confident that Ukraine can prevail in the conflict.

Importance of Financial and Military Support

Financial and military support is essential for Ukraine, as the military conflict could continue for an extended period. G7 partners are now signaling their support for a longer conflict instead of pushing Ukraine to accept an end to the war.

Serhiy Marchenko, Ukrainian Finance Minister
Serhiy Marchenko, Ukrainian Finance Minister

US Economic and Military Aid Appreciated

Ukraine appreciates the $50 billion in economic and military support provided by the United States since the war began. Marchenko is confident that the US Congress will maintain bipartisan support for Ukraine despite some calls to scale back funding.

Reconstruction Efforts and War Insurance Development

There is an urgent need to begin reconstruction in Ukraine, including energy infrastructure, roads, schools, and housing. Developing war insurance with the World Bank's Multilateral Investment Guarantee Agency (MIGA) is a crucial step to encourage global companies to participate in the rebuilding process, estimated to cost at least $411 billion.

Debating the Use of Russia's Frozen Assets for Ukraine's Reconstruction

Donor countries are increasingly open to using Russia's frozen assets for Ukraine's reconstruction. G7 officials broadly support this proposal but still must find a legal solution for a complicated issue. US Treasury Secretary Janet Yellen cautioned there are legal constraints on using frozen Russian assets to pay for damage to Ukraine.

No Spillover Effects on the Ukrainian Banking Sector

Marchenko mentioned intense discussions about financial stability during the week's meetings following the collapse of two US banks and one Swiss bank last month. However, he sees no signs of spillover effects on the Ukrainian banking sector.