Ukraine war: Zelensky to meet Biden as Kyiv running out of options to finance its fight against Russia

Policymakers in Kyiv are grappling with the challenge of financing Ukraine's war effort in the event that promised aid from allies fails to materialize. The options they are considering are fraught with risk. The financial strategies under consideration include increasing tax revenue, a daunting task in a struggling economy, or reducing public spending, which would further burden an already beleaguered populace. Monetary-policy options include devaluing the Ukrainian currency or tapping into the central bank's reserves, a move that Finance Minister Serhiy Marchenko warned could have detrimental effects.

President Volodymyr Zelensky is currently in Washington, where he is making an urgent appeal to US Congressional Republicans who are blocking the disbursement of more than US$60 billion proposed by President Joe Biden. Concurrently, a €50 billion (US$53. 9 billion) aid package from the European Union is being obstructed by Hungarian Prime Minister Viktor Orban due to a broader dispute over the bloc's budget.

The stakes are high for Ukraine, as Kyiv's counteroffensive has failed to yield significant gains and the second full winter since the Russian invasion is bringing new hardships. A cessation of financial support could potentially hand Vladimir Putin a victory that would alter the geopolitical landscape of Europe. On Monday, Moscow announced that it will be closely monitoring the Zelensky-Biden meeting. Kremlin spokesman Dmitry Peskov stated that the substantial aid already provided by Washington to Kyiv has not been successful in turning the tide of the war, and he suggested that further aid would be similarly ineffective. He also implied that Zelensky's authority is being undermined by these failures.