Page 36 - UKRRptOct22

Transfers and social protection spending increased, as did procurement of goods and services, to pay for basic recovery work. All told - despite the cuts in non-priority areas - surging spending and falling tax revenues have opened a nonmilitary fiscal need of over US$15bn for the second half of 2022. This figure takes account of Kyiv’s efforts to reduce its debt service by rolling over domestic debt and a two-year deferral on external debt amortization. Allowing for military spending and current recovery needs, Ukraine’s total fiscal financing needs may reach US$28.8bn in the second half of 2022 (around US$4.8bn per month).
6.1.3 Budget dynamics - funding
Joe Biden approves $12.3B in aid to Ukraine. US President Joe Biden signed a temporary governmental funding law, which avoids the suspension of federal operations and provides for the allocation of $12.3B in aid to Ukraine, the White House press service reported. Included in the Ukrainian assistance package is $3B in military assistance, including training, equipment, weapons, and logistical support. Another $1.5B is earmarked to replenish stocks of foreign equipment supplied to Ukraine. Moreover, $2.8B is for the continuation of the military, intelligence, and other defensive support. An additional $35M will go toward financing responses to "potential nuclear and radiological incidents" in Ukraine and preventing the theft of these materials.
Ukraine receives $1.5bn from US. It is the last tranche of the $4.5bn grant provided by the U.S. from the World Bank's trust fund, Prime Minister Denys Shmyhal said on September 17.. Ukraine will spend the money on pensions and social care. On Sept. 14, Shmyhal said Ukraine relies on its foreign partners to face massive expenses in the coming year as the budget deficit in 2023 may amount to around $38bn.
The US plans to announce a new $625M aid package for Ukraine.
According to a senior defense official, the US is set to announce another $625M aid package for Ukraine, which will include four more HIMARS, along with additional howitzers and ammunition. The package, which falls under the Presidential Drawdown Authority and will be pulled directly from US stocks, also includes 16 105mm howitzers and 75,000 rounds of 155mm artillery rounds. Including this package, Ukraine will have a total of 20 HIMARS systems, which the Ukrainian military has used to great effect against Russian forces. The Ukrainians have used the Guided Multiple Launch Rocket System (GMLRS) munition, fired from the HIMARS vehicle, to carry out precision strikes against Russian logistics hubs, command posts, ammunition depots, and more.
Ukraine is applying for $1.3B in emergency aid from IMF. On September 30, the Board of Executive Directors of the IMF approved the expansion of anti-crisis financing instruments, which will enable Ukraine to apply for a new tranche of aid within the scope of the Rapid Financing Instrument, the NBU reported. This anti-shock food window provides additional aid to countries suffering from significant cashflow deficits caused by the global food crisis. Ukraine plans to request an additional $1.3B from the IMF under this program. “After approval by the Board of Executive Directors of the IMF, these funds may arrive as early as October," noted NBU Chairman Kyrylo Shevchenko. He added that Ukraine hopes to start work on a new full-fledged IMF program as soon as possible.
36 UKRAINE Country Report October 2022 www.intellinews.com