20 ‒ 24 October 2025
Dear friends of Ukraine,
the Ukrainian parliament has passed the draft state budget for 2026 in its first reading. Defence remains the largest item, accounting for 27 per cent of economic output. 42 per cent of expenditure is to be covered by international aid, and the deficit is expected to be around 18 per cent of GDP (over 26 per cent was planned for 2025). The plan is based on a relatively realistic 2.6 per cent economic growth next year. This makes Ukraine as solid as a country can be after 3.5 years of war. Since no one knows how long this war will last, Ukrainians are working hard and successfully to stand on their own two feet as much as possible.
One way for other countries to support Ukraine at little cost is to allow Ukrainian companies access to their own markets. And yet there are repeated attempts to make it more difficult for Ukrainian companies to gain access. The Polish steel industry is currently lobbying in Warsaw and Brussels to this end. We believe that market access restrictions for Ukrainian companies in the EU are a clear case of lose-lose.
Meanwhile, the head of Ukraine's military intelligence, General Budanov, stated that the economic damage Ukraine is inflicting on russia through attacks is now greater than the effect of Western sanctions. Hopefully, the damage will continue to increase and soon become prohibitively high.
We send you warm greetings from Kyiv and wish you a peaceful weekend.
Kind regards
P.S.: Please send feedback to nataliia.hryshchenko@ukraine.ahk.de and / or reiner.perau@ukraine.ahk.de.
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