Ukraine is facing its most severe budget shortfall since the start of the invasion — AP
Russian strikes on industrial facilities, the energy sector, and port infrastructure are increasing pressure on the Ukrainian economy. Due to the shutdown of steel production and a decline in exports, the country is losing foreign exchange earnings, tax revenue, and jobs.
One of the hardest blows was the shutdown of Kametstal in Kamensk. Following an attack by five ballistic missiles on September 5, the plant ceased operations. In 2025, the plant accounted for more than a quarter of Ukraine’s steel production.
Related industries—construction, machine building, mining, energy, and logistics—are feeling the consequences. According to the plant’s CEO, Oleksandr Tretyakov, the current situation in the Ukrainian steel industry is the most severe since World War II.
Russian attacks on Black Sea ports and shipping are creating additional problems. According to Lloyd’s List Intelligence, in August, the number of ship calls at Ukrainian Black Sea ports fell by approximately 90% year-over-year. Rerouting cargo to the Danube and overland routes increases costs and does not compensate for lost opportunities.
Roksolana Pidlasa, chair of the Verkhovna Rada’s Budget Committee, stated that Ukraine is facing its most acute funding shortfall since the start of the full-scale invasion. Due to declining tax revenues, the government is finding it more difficult to finance planned expenditures, despite international aid.
At the same time, about 40% of GDP is allocated to defense, and military needs, salaries for public sector employees, pensions, and social benefits remain among the budget’s priorities.
Source: Associated Press
The European Union plans to provide Ukraine with 920 million euros to restore and strengthen its energy infrastructure ahead of winter. This was announced by European Commission President Ursula von der Leyen.
On July 30, the European Union transferred another financial tranche of 3.47 billion euros to Ukraine. The funds will be used to support the country’s defense capabilities and finance priority government needs amid a full-scale war.
Ukraine expects the International Monetary Fund to approve a new tranche of $690 million by mid-July. The decision is to be made by the IMF’s Executive Board following the completion of a review of the cooperation program. The parties have already agreed on key parameters and the next steps for reforms.
