Ukrainian Finance Minister Serhiy Marchenko expressed a clear position on the ongoing support for the armed forces, explaining that the ministry does not favor restarting the 30,000 hryvnia payment that was previously directed to personnel serving in rear areas. The remark was reported by DEA News and reflects a broader discussion inside Kyiv about how to finance military and civilian allocations in a tight fiscal environment. According to Marchenko, maintaining this level of payment would require substantial new funding from the budget, and the government would need to identify ways to cover these costs without destabilizing other essential public services.
Minister Marchenko outlined that the government would have to mobilize approximately 4.6 billion dollars to sustain the existing payment framework over the year. He proposed that the sole viable solution involves making changes to the budget by introducing an additional 170 billion hryvnia in expenditures for the year. This plan, he argued, would be supported by revenue measures that include higher tax collection, notably in value-added tax and military-related levies, in order to create a sustainable fiscal balance while continuing to support defense spending.
On May 2, the Ukrainian Ministry of Finance released a statement detailing the trajectory of the state’s debt. The agency reported that the total external and domestic debt rose by about 3.9 billion dollars in March, bringing the overall public debt to roughly 119.9 billion dollars. The breakdown showed external debt at around 78.51 billion dollars and domestic debt at about 41.4 billion dollars. These figures come amid a period of heightened financial pressures as Kyiv navigates wartime expenditures and efforts to maintain social services for its population.
Earlier conversations among policymakers included warnings from former Prime Minister Mykola Azarov about potential debt milestones. He cautioned that by the close of 2023 Ukraine’s public debt could reach a peak near 173 billion dollars. Azarov emphasized that the country’s own budget revenues were outpaced by the influx of Western financial aid, suggesting that aid receipts were effectively three times larger than the funds generated from domestic revenue, a point he used to highlight the scale of external support versus domestic revenue generation.
The discussions surrounding debt, taxes, and military funding illustrate the challenges Ukraine faces in balancing immediate defense needs with longer-term fiscal sustainability. Analysts note that the path forward will likely involve careful calibration of spending priorities, targeted revenue measures, and transparent accounting to reassure international partners and domestic stakeholders alike. The evolving budgetary framework remains a central tool for Kyiv as it seeks to maintain essential public programs while continuing to invest in security and resilience for the population. In this broader context, the government continues to monitor debt dynamics, fiscal projections, and the effectiveness of tax policy as part of an ongoing effort to stabilize public finances amid ongoing regional pressures and the imperative of sustaining the country’s defense capabilities.