(KYIV) – Ukraine must adopt a series of fiscal and governance reforms by the 1st November to unlock up to €45 billion (£38 billion / $49 billion) in European Union funding for 2026. The government has committed to this timeline to ensure access to crucial budget support.
The total EU package for 2026–2027, known as the Ukraine Support Loan, is worth €90 billion (£76 billion / $98 billion). While approximately €60 billion is earmarked for military and defence-industrial support, around €30 billion is allocated for general budget assistance.
In a statement on the 7th September, Ukrainian Prime Minister Serhii Koretskyi confirmed the plan after discussions with Valdis Dombrovskis, the European Commissioner for Economy and Productivity. “We expect to make full use of the financial resources provided for by the relevant instruments. We plan to adopt the necessary government decisions by November 1,” Mr Koretskyi said.
The funding requires Ukraine to meet specific conditions laid out in a Memorandum of Understanding with the EU. Key requirements include changes to tax policy, such as regulating income from digital platforms and abolishing tax exemptions for most imported parcels. The commitments also involve aligning corporate taxation with EU rules to combat tax evasion.
Further reforms are stipulated for public finance management. The government must develop a new public investment system and approve a Budget Declaration for 2027–2029 that aligns with targets agreed with the International Monetary Fund. Reforms to the customs system and the State Customs Service are also required.
A significant fiscal measure is the reform of the simplified taxation system. This is intended to combat the artificial splitting of businesses and is expected to generate an additional fiscal effect of at least UAH 70 billion (£1.3 billion / $1.7 billion) per year.
Access to the funding is also explicitly linked to Ukraine’s adherence to the rule of law, effective democratic mechanisms, and the fight against corruption. The agreement prohibits any backsliding on previously introduced anti-corruption measures.
The €16.7 billion (£14.2 billion / $18.2 billion) designated for direct budget support in 2026 is divided between macro-financial assistance and the Ukraine Facility mechanism. The first tranche of €3.2 billion was transferred on the 25th June. Future payments are not automatic; the European Commission will assess compliance before each disbursement. A negative assessment could lead to delays or the loss of specific tranches, though not necessarily the entire package.
Earlier in September, Ukrainian President Volodymyr Zelenskyy stated that roughly $30 billion in partner financing depends on domestic decision-making. He specified that 44 government decisions would unlock around $15 billion, with a further $15 billion contingent on laws passed by the Verkhovna Rada.
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