Without Western aid, Ukraine will be forced to start printing money - WSJ

While the US and the European Union are wrangling over approving $60 billion and €50 billion in military aid to Ukraine, Ukraine is struggling to keep salaries, pensions and subsidies paid to the population and the government running. If the aid does not arrive soon, Kyiv will have to take "painful economic measures," The Wall Street Journal writes, citing Ukrainian officials.

In 2024, Ukraine will face a budget deficit of $40 billion, about $30 billion of which the government plans to cover with aid from allies.

The country has already introduced a tax on windfall profits of banks, redistributed some tax revenues, and increased domestic borrowing – these measures should cover the budget deficit until February. Ultimately, without Western support, Ukraine will be forced to print money, which will jeopardize economic stability and support from creditors such as the International Monetary Fund, the newspaper writes.

According to the WSJ, Western partners are looking for a way to make Ukraine more economically self-sufficient in the face of the war, which is now in its third year, as its ability to stand up to Russia depends on it.

One way is to confiscate the widely discussed reserves of the Central Bank of Russia, which have been frozen in Western jurisdictions since the start of the invasion. However, the process of transferring Russian savings to Ukraine could take years, and help is needed immediately.

Background. As reported by the WSJ: the EU has come up with a new plan for military aid to Ukraine, which provides for joint supplies worth tens of billions of euros.