Bloomberg: EU questions Kyiv’s calculations on €26 billion budget gap

Ukraine informed its allies of an unexpected gap in the state budget of approximately €26 billion and asked the European Union to accelerate the disbursement of a €90 billion loan intended to fund the country through the end of next year.

However, the EU has questioned the validity of the calculations presented by Kyiv. This was reported by Bloomberg.

According to the agency, Brussels is disputing a number of figures that the Ukrainian side is using to justify its request. In addition, the EU believes that additional financing should be provided not only by member states but also by Ukraine’s other partners — in particular, Canada, Norway, and Japan.

Following a meeting with Ukrainian President Volodymyr Zelensky, European Commission President Ursula von der Leyen separately noted that €37 billion remains available for Ukraine this year. She linked further budget support to progress on reforms in the Verkhovna Rada. Discussions on financing will continue in 7–10 days.

According to Bloomberg, the meeting between Zelensky and von der Leyen on the sidelines of the UN General Assembly in New York was tense.

The key question remains whether Europe will demand, as a condition for releasing funds, that the Rada pass and Zelensky sign the Kachka-Kos legislative package. This package provides for removing law enforcement agencies from presidential control by selecting personnel through competitive processes in which international experts have the deciding vote. Zelensky is reluctant to give the go-ahead for the package’s adoption, but if the EU firmly ties further assistance to its passage, the president and the Rada will have few options to avoid it.

Europeans have so far not explicitly and publicly named the Kachka-Kos package as a condition for financing. At the same time, formulations about “ensuring the rule of law and combating corruption” are typically used to justify the adoption of laws of this kind.