How much money do you need to Ukraine?

How much money do you need to Ukraine? I ask the question because the IMF just threw the report eighth view Financial support program for Kyiv. But I really ask, for the answers you answer – read for mine – economics and war clarify the wider questions. Share your thoughts with us freelunch@ft.com.

IMF report, in the conditions, the good news. All are relatives! Despite a close attack on Russian President Vladimir Putin, the Ukrainian economy is strong, politics is good and improved in public finance and reforms are on the road. Impressive so far.

The analysis is a 15-billion financing package of $ 15.5 billion in the IMF’s program for $ 15.5 billion in four years, which is $ 153 billion in the United States and other friends. Although the Coalition can provide Ukraine so far and the United States allows Ukraine, the “Financing Needs” will be able to provide about $ 40 billion a year, and even if the United States can even fall down.

However, the “financing needs” $ 40 billion in $ 40 billion a year “does not mean $ 40 billion in $ 40 billion. Timothey Ash, financial analyst, wrote Fair angry blog post About the risks of hiding a larger and more disturbing fact of the IMF analysis. Ash makes the following observations. First, the total amount of Western countries is $ 100 billion in the divinity, including military gang, including the military gang, said the Kiel Institute is excellent Ukraine Tracker. Second, even this is enough to allow Kiev to fight and not win the war. Third, the IMF’s calculations are located in the late 2025 or in the mid-2026, in the war in a negative scenario. Therefore, financing has been in need of indifferent in 2026 since 2026.

Ash speculates, it would be more than $ 100 billion, to put a fairly dominant position in Ukraine to defeat the Russian invaders. Who knows? But now it is more than given to Ukraine, which allows you to hold a line, but not more. Thus, the ashes, IMF figures are relatively modest in Ukraine’s financial needs, so it is true that the managers can make a wrong impression. This is the fact that Western technocrats are “full financing” of Ukraine, which allow to distract the truth that Western political leaders should do.

In fact, it is worse: If the West Lowballs have financial support to Ukraine, the war will last longer compared to the establishment of a nasty surprise in more consolation analysis, leaders and public.

As with the IMF number, it is concerned, the reasons. One means “financing” means something different for technical economists, compared to most people: This is the need for how much you need to borrow your debt to the service. Ukraine does not represent any non-technical sense of non-technical sense or does not represent a real measure of “need”. The other will be able to lend a program that the IMF does not legally add to a program that is why the analysis should be analyzed the day, the day of the chips should be taken. This would be worse than a wrong number.

There are a number of other important observations of the Ukrainian economy and the state financing; Some are good, some are bad. First of all, the Ukrainian government is improving in increasing local resources (tax and other income). This is marked by the IMF and is born at the same time Latest “financial digestion” Kyiv Economic School. In the first quarter of this year, tax revenues exceeded the target of the government significantly (both in inflation) – more of this budget – this budget is going on to the defense – another reason to think that the above needs are very optimistic – social costs can be squeezed.

And there is still something surprising about the country’s economic activity. We hear a lot about the fact that the Russian economy is better than expected (many of this) better exaggerated). But see the Ukrainian economy! In 2022, a large part of GDP was occupied and the escape of millions of refugees was opened in 2022. However, since then, Ukraine said he would prevalent. IMF, in 2023 or in 2026 or in 2026 and 2026, about 3 percent of about 3 or 3 percent, and forecasting and forecasting and forecasting.

This is a very favorable comparison with Russia. Ukraine’s inflation is not worse than Russia Central Bank Interest Rates is low. Unemployment has admitted that it is high – partly a function of Kiev decides to spare the youngest men from the horrors of the front.

However, in general, Ukraine’s growth performance since 2022 has been made since Russia, and if the IMF’s forecasts are correct, the country will be more than twice the country attacking him until 2030.

This is another way to look at it better. The US dollar-based investor who built a share in Ukraine in 2022 this year, in Russian GDP to 10 percent of the nominal dollar loss in Russian GDP would earn nominal dollar income. For comparison, this figure for US GDP is 17 percent. If we believe the IMF 2030 forecasts, the cumulative nominal dollar comes from time to 74 percent, 43 percent and 43 percent. Ukraine is worth betting.

All this but careful. Ukraine struggles to attract capital; It is mainly obliged to borrow from the EU. To add the binding numbers of the IMF, the resetting of the ongoing debts must be successfully completed. In addition, Ukraine should not be in the hook – as legally, as it is legally – for “extraordinary income speed” (ERA), which is the risk of returning to Russia with each six-month renewal voting for “extraordinary income acceleration”. In terms of real economy, it depends on the war, but IMF and KSE also warns that the last and black sea shipping road to the EU will be a bad war in the economy.

So how much do you need to Ukraine? Ash is right to say that the war needs to win the war and the estimates of $ 150 billion a year is any better. Meanwhile KSE, Approximate $ 300 billion dollars from abroad will be required for $ 300 billion capital “Investments needed to improve productivity and ensure strong economic growth.”

But how to think about it: the total amounts can understand how the war can end the war due to the war, and in turn, how much money is given. Ash, comparing to $ 100 billion in the two years, will swear by the European governments to help victory with additional amounts of Ukraine, and now causes a violation of a Russian-not-leaving Russian:

Now think about the value of not winning Ukraine – the strategy we last in the last 3.5 years. This is the Western yet $ 100 billion in a year, but now Europe must increase NATO’s defense costs from 2% to 3.5% to 3.5% and increase to 5%. Every 1% of GDP’s defense consumption of NATO is $ 300 billion, so it is twice as much to defeat the annual cost of financing Ukraine and the threat of Russia. European defense spending, which increases European defense costs, is $ 750 billion in this year’s repetitive defense spending. Are we actually stupid? Thus, we can increase $ 50 billion a year to defeat Ukraine to Ukraine for two years or we can spend $ 750 billion a year for years for years.

And I think it, understanding The benefit of costs. A winner would be a Ukraine in Ukraine (KSE, if the war is completed, provides 7 percent growth rate in 2027). This will make a profit for investors that bring small cargo to Western taxpayers and the reconstruction capital of Ukraine. Defeated Ukraine or even even suffering this war in the same way, it will not offer these economic opportunities.

And then I have long-term bugbear: West Inability to transfer Russia’s best foreign exchange reserves – $ 300 billion to $ 300 billion, as a while, it is clearly obliged to compensate Moscow. There is only one alternative to give this to Ukraine, which is to return to Russia and to meet the needs of Ukraine’s financing for the West (mainly Europe) taxpayers.

The highly placed EU diplomat says this assets will have an updated dispute to transfer these assets due to the transfer of assets. What I wrote above shows that such an account can come sooner than the moment.

Other readers

● To wrap to A new era of financial repression And in a hurry for the investment capital of the world.

● Fantasies of the far right.

● There were US dollars The worst performance In the first six months of the year since 1973.

● Pilita Clark explains How long can climate risk trigger the next major financial crisis.