Coin Press - Ukraine plans record defence spending in 2027

Russia's four-and-a-half-year offensive has battered Ukraine's economy, causing billions of dollars in destruction and punching a huge hole in its neighbour's finances.

The war-torn country initially used its own revenues to pay for defence spending but has increasingly relied on foreign backers for these outlays.

The Ukrainian government will seek an additional $53 billion in foreign aid next year, including from the International Monetary Fund and World Bank, it said.

"The draft budget for 2027 was formed at a time when Russian aggression was continuing, and security and defence needs remained crucial," Ukraine's finance minister Sergiy Marchenko said in a press release published Tuesday.

"This is unquestionably the government's number one priority. All possible internal resources of the state are being channelled towards ensuring Ukraine can effectively resist the aggressor," he added.

Ukraine plans to spend a record 4.9 trillion hryvnia ($109 billion) on defence and security in 2027, around 44 percent of its GDP and a record since Russia invaded in 2022, according to the release.

About a third of this will go towards wages for soldiers, while the remainder will largely go towards weapons and equipment, the release said.

In comparison, Russia planned to spend around 13.6 trillion rubles ($161 billion) on defence in 2027, or around 30 percent of its budget.

Ukrainian President Volodymyr Zelensky on Tuesday warned parliament would have to pass "unpleasant and unpopular" measures to attract foreign financing, among them a tax on foreign parcels.

"Right now, without these things, it is impossible to ensure the full needs of our defence and the resilience of Ukraine," he said.

Ukraine has received around $200 billion in financing from its foreign partners since Russia invaded in 2022, as well as billions of dollars in military aid.

H.Müller--CPN