European aid to Ukraine, an essential but insufficient injection to pay for the war effort

The new aid package from the European Union comes at a critical time for Ukraine. Its army is being surpassed in all areas by Russia in the war, the public debt is skyrocketing and in the United States Democrats and Republicans seem far from reaching an agreement to sustain their support for kyiv. The 50 billion euros agreed this Thursday by the EU leaders for the next four years are an essential lifeline to resist on the front and sustain the Government's budget. But this money alone will not be enough for Ukraine to meet its goals, the country's leaders have warned.

The problem is that without Washington, Ukraine has no chance of resisting the Russian offensive. This was stated on January 29 by President Volodymyr Zelensky in an interview for German television ARD. “Europe alone cannot resist if support from the United States is suspended, neither in weapons nor in financial support.” kyiv, in fact, has always trusted that the EU would circumvent the Hungarian veto, especially after last Monday's meeting between the Hungarian and Ukrainian foreign ministers, and Zelensky's number two, Andrii Yermak.

The State budget for this year contemplates income of 43,775 million euros compared to expenses of almost double: 82,385 million. The Ukrainian Prime Minister, Denis Shmihal, stated on January 26 through a statement that they estimated that 18 billion of the annual public deficit would be covered with the European package, that is, with 36% of the 50 billion committed until 2027. The Minister of Economy, Yulia Sviridenko, assured this Thursday that she expects a first batch of 4.5 billion to arrive this March.

Ukrainian public debt will be equivalent to 100% of gross domestic product in 2024 (close to 40 billion) compared to 48% before the invasion, according to the International Monetary Fund. 45% of the 2024 budget, 37 billion, is allocated to defense, equivalent to 22% of GDP. This is not just money for weapons, above all it is for fuel, transportation, salaries and maintenance of the almost 880,000 men and women serving in the Armed Forces and other national defense bodies.

According to the American Wilson Center for Policy Studies, Ukraine plans to have international defense aid equal to 13% of GDP. Without this, the Government will not be able to cover other fundamental legs of the State at a time when unemployment has skyrocketed from 9.8% before the war to 24.5% today, according to IMF data, and in which millions of people displaced by fighting receive subsidies as internal refugees.

Less international aid

The transfer of international aid has decreased sharply since last fall. The Institute for the World Economy in Kiel (Germany), a reference think tank for monitoring economic and military support to Ukraine, estimated last December that between the summer and fall of 2023, international assistance commitments for Kiev had decreased by 90%. Since the beginning of the invasion, in February 2022, and until October 2023, shortly after the failure of the Ukrainian counteroffensive was confirmed, the EU had agreed to aid valued at 84.3 billion euros and the United States, 71.4 billion. Germany, the third donor, contributed 21 billion and the United Kingdom, 13.3 billion.

Ukrainian fear focuses above all on what happens in Washington. The White House has budgeted 55 billion euros in assistance to Ukraine, a package that the Republican Party blocks from the legislative branch. Voices critical of aid to kyiv are the majority in the conservative formation, with former president Donald Trump as a reference. They demand that the president, Joe Biden, and the Democratic Party agree to increase the security budget on the border with Mexico to unblock the agreement on Ukraine. Democrats are opposed.

Zelensky stated in Washington last September that without American assistance, Ukraine would lose the war. “Without the support of the United States, we could not survive, it is a fact,” the president reiterated on January 19 in an interview with Channel 4 television. The White House is his main military support: in the first 20 months of war, The United States committed 44 billion euros in weapons to Ukraine; The second supplier of military equipment was Germany, with 17.1 billion euros, according to the Kiel Institute. The EU, on the other hand, contributed 77.1 billion to the finances of Ukraine and the United States, 25,000.

The Ukrainian Defense Minister, Rustem Umerov, sent this week to his partners in the EU a document in which he illustrates the disadvantage that his troops are suffering compared to Russia. The document, advanced by the Bloomberg agency, ensures that the invader triples the number of Ukrainian artillery in projectiles fired. The Ukrainian artillery would be using 2,000 projectiles a day, while the Russian artillery has 6,000 a day, according to Umerov's report. The minister insists that Ukraine must at least have the same firepower as its enemy.

Russia is advancing again on the Donetsk province and Kharkiv fronts, surpassing the Ukrainians in infantry, air dominance with drones, armor and artillery. The Russian defense budget for 2024 will exceed 129 billion euros, according to an analysis last December published by the Stockholm International Peace Research Institute, more than triple the Ukrainian budget.

Military theory indicates that an offensive army, to be successful, must be at least three times superior in resources to the one defending. A recurring complaint from the Ukrainian political and military leadership is that its Western allies have never provided enough military aid to have clear superiority over Russia and be able to recover lost territory. “They have helped us to hold on, but not to win,” Zelensky said on Channel 4. Washington Post It was announced on January 26, from anonymous sources in the US Government, that the Biden Administration is planning assistance for Ukraine in the next decade only to defend itself, without contemplating the possibility that it could reconquer the ground occupied by Moscow.

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