Ukraine is poised to receive financial support from the European Union in early April, despite a veto from Hungarian Prime Minister Viktor Orbán. The National Bank of Ukraine (NBU) has also prepared a contingency plan to address any unforeseen challenges.
NBU Governor Andriy Pyshnyy stated that the expected EU funding is crucial for the country’s financial stability. He emphasized that while it is impossible to fully replace such significant funding, the backup plan includes measures related to monetary policy and debt management.
“In my office, I have an entire shelf filled with these ‘Plan B’ strategies. I could even teach a course on how to develop them. I don’t want to incite panic, but if Ukraine does not receive this credit support, we have two main sources to fill that gap: the domestic debt market and the monetization of budgetary needs,” Pyshnyy explained.
He also noted that accumulating gold reserves, a strategy employed by other central banks as a buffer during wartime, is not a feasible option for Ukraine. “Of course, we have discussed this issue, but the situation in Ukraine is somewhat unique. We must maintain a state of high liquidity,” he added.
Ukraine is preparing for potential EU funding in April while the NBU has devised a backup plan to ensure financial stability. Governor Pyshnyy outlines alternative funding sources should the expected support not materialize.