G-7 to unveil Ukraine aid plan to offset costs of Russian invasion

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BONN, Germany — Financial leaders of the Group of Seven nations are expected to unveil a major new economic aid package as early as Wednesday to help the Ukrainian government offset losses from the Russian invasion, according to two people familiar with the matter.

World officials have considered providing up to $15 billion in aid to Ukrainians to cover financial losses caused by the war, although the final details of the measure are still being worked out, they said. speaking on condition of anonymity to discuss the planning not yet made public.

Ukrainian officials estimate that they currently face a monthly deficit of around $5 billion. The aid would be intended to cover Ukraine’s deficit for three months – which would amount to short-term economic assistance, as world leaders have signaled that a much larger long-term stimulus package may be needed.

The assistance program could be provided by a combination of partners, including the International Monetary Fund.

Congress is currently on track to approve around $40 billion in aid to Ukraine following a request from the Biden administration, though that funding includes military assistance. Ukrainian leaders attending a Group of 20 meeting last month called for $5 billion a month in economic aid alone, including about $2 billion a month from the United States.

Ukraine has suffered more than $94 billion in direct infrastructure damage since the war began, with more than $550 billion in total economic losses, according to researchers at the Kyiv School of Economics.

Ukraine asks the United States for $2 billion a month in emergency economic aid

About three dozen countries have already provided Ukraine with aid totaling $24 billion, according to estimates by the Kiel Institute for the World Economy, a German think tank.

Ukrainian officials have said failure to provide additional international aid would worsen a devastating humanitarian crisis, pointing to their inability to make planned government payments and repair needed infrastructure.

“Our economy is partly destroyed,” Sergey Nikiforov, spokesman for Ukrainian President Volodymyr Zelensky, said in an interview. “Our export capacity and our steel plants are destroyed, and we have this huge monthly deficit. … Tax and customs revenues are not as high as they were before the war. Nikiforov also pointed out that more than 12 Millions of Ukrainians have been displaced by war, both internally and externally.

G-7 finance ministers due to meet in Bonn this week face huge challenges as they try to increase financial pressure on Russia following its invasion amid escalating headwinds economy in their own country. Besides the United States, the largest contributions to date have come from Poland, Britain, Canada and Germany, according to the Committee for a Responsible Federal Budget, a Washington think tank.

Global economic tremors complicate Western leaders’ sanctions on Russia

In a speech in Brussels on Tuesday, US Treasury Secretary Janet L. Yellen pleaded with European allies to provide more aid to the Ukrainian government.

“I sincerely ask all of our partners to join us in increasing their financial support for Ukraine,” Yellen said, according to a prepared transcript of his remarks. “Our joint efforts are essential to help ensure that Ukrainian democracy trumps [Vladimir] Putin’s aggressiveness.

Rauhala reported from Brussels.

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