International aid to Ukraine to slightly decrease in 2024 – Fitch
Pravda Ukraine
The amount of international aid to Ukraine in 2024 will be slightly lower than it was in 2023.
Source: Fitch, an international ratings agency
Details: At the same time, Fitch estimated that the reduction in aid would be insignificant.
Quote: “Fitch anticipates 2024 budget aid support will be only slightly below the USD43 billion estimated for 2023, despite political risks to approval of pledged finance.”
Details: Longer-term proposals include a €50 billion EU loan to Ukraine until 2027, as well as the broader official sector financing guarantees that underpin the IMF EFF.
“MF conditionality in the first phase of the programme is light and we see limited risk it prevents Fund disbursements next year,” Fitch states.
At the same time, Fitch Ratings sees great funding uncertainty from 2025 onwards, partly due to the US election cycle, potential donor fatigue, and residual risks to EU funding plans.
Quote: “We see greater financing uncertainty from 2025, partly due to the US electoral cycle, the potential for greater donor fatigue, residual risks over EU financing plans, and the possibility that the domestic banking sector does not further increase its holding of government debt.”
More details: Fitch forecasts that government debt will rise to 94.5% of GDP by end-2024 from 84.1% by end-2023 (and 48.9% by end-2021), well above the ‘B’/’C’/’D’ rating average for sovereigns, 70.7%. The forecasts do not include a potential debt restructuring procedure, the parameters of which remain uncertain.
Background:
- Fitch Ratings has confirmed Ukraine’s long-term foreign-currency issuer default ratings at CC and local-currency issuer default ratings at CCC-.
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