Ukraine's annual debt payments have been calculated. What you need to know

Ukraine will pay about 10% of GDP annually to pay off its debts. At the same time, the Verkhovna Rada adopted a budget with a deficit of 18.4% of GDP for next year, which will require new injections from foreign countries. Kiev directs almost all of its own revenues to military spending. The situation of Ukraine's financial system is described in the Izvestia article.

Debts for the coming years

• In the coming years, Ukraine's debt payments will amount to about 10% of the country's gross domestic product (GDP). This indicator is fixed in the debt strategy for 2026-2028, which was developed by the Ministry of Finance of Ukraine and adopted by the Government of the country. By the end of 2025, the country's GDP is expected to exceed $200 billion, reaching about $212 billion in nominal GDP. Expectations for 2026 vary, with an expected increase of about 2.8%.

• The strategy determines that by the end of 2025, servicing of all debts will amount to 1.05 trillion hryvnias ($25 billion). In 2026, payments will amount to 1.17 trillion hryvnias ($27 billion), then they will increase to 1.26 trillion hryvnias ($30 billion) in 2027 and 1.29 trillion hryvnias ($30.5 billion) in 2028. On average, servicing and paying off debts will cost the budget 1.193 trillion hryvnias ($28 billion).

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• As a percentage of GDP, payments will gradually decrease. It is planned that by the end of 2025, the amount paid will amount to 11.7% of the gross domestic product, 11.3% in 2026, 10.5% in 2027, and 9.5% in 2028. At the same time, since three quarters of Ukraine's public debt is denominated in foreign currency, there are risks to the sustainability of the national debt in the future. In total, the entire national debt of Ukraine is calculated at an average rate of about 4.9%, which is almost twice as high as, for example, France and the United States.

• The International Monetary Fund (IMF) predicts that Ukraine's national debt will continue to grow in 2026 and will reach 110.4% of GDP after 109% in 2025. Kiev ranks 16th among the leading debtor countries. Ukraine's public debt will continue to exceed its own GDP at least until 2028, according to the IMF.

The military budget is in short supply

• In December, the Verkhovna Rada adopted the state budget for 2026. It provides for a deficit of 18.4% of GDP. In 2024, when this figure was about the same, the budget deficit situation was worse only in East Timor and Kiribati (an island state in the Pacific Ocean). Double-digit deficit figures will be fixed for the fifth time in a row.

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• Ukraine is expected to require external support in the amount of 2.079 trillion hryvnias ($49 billion). The government will attract resources through the World Bank, the European Union, the United Kingdom, the IMF and separately through the G7 countries. The total payments for repayment and servicing of public debt will amount to UAH 1.17 trillion ($27 billion), as indicated in the government's debt strategy. Within the framework of the budget for 2026, they will amount to 24% of the total expenditure.

• The priority of the Ukrainian budget is given to spending on defense and security. They will amount to 2.806 trillion hryvnias ($66.5 billion), that is, 58% of the total budget expenditure, or about 27.2% of GDP. Military budget expenditures are almost completely equal to the entire revenue side. Almost half of it, or about 1.272 trillion hryvnias ($30 billion), will go to payments to military personnel.

Credit injections

• 2025 was another year of massive monetary injections from foreign countries into Ukraine. What has changed compared to previous years is that American financial aid has come to naught. In January, the administration of outgoing President Joe Biden managed to allocate only €480 million, after which Donald Trump stopped financial support. Europe, according to the Kiel Institute of World Economy, paid €57.81 billion from January to October 2025.

• By the end of 2025, the European Union approved another loan to Ukraine in the amount of €90 billion for the next two years. Neither the association itself nor individual countries have such funds in the form of live money yet. The European Commission intends to reach out to the markets and raise the entire amount from scratch through the issuance of short- and long-term bonds. It is expected that the tranches will be allocated gradually, starting in April.

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• This loan differs from other financial influences in that the EU countries themselves will pay the interest on the loan, which will amount to about €20 billion. They will have to include this amount in their budgets from 2028 to 2034 in proportion to their economic weight, that is, Germany, France and Italy will pay the most for the loan to Ukraine. The European Union plans to repay the entire debt if Russia pays reparations.

• At the same time, the loan has a number of essential conditions. For example, payments may be suspended if Ukraine takes a step back in the fight against corruption. It is imperative that Kiev continue to improve anti-corruption measures. Oversight of how payments received will be allocated to military contracts will also be strengthened. The money will have to contribute to the development of the European military industry, and it will be prohibited to spend it outside Ukraine and the European Union, unless we are talking about unique weapons.