IMF revises forecasts: how long the war in Ukraine will last

The International Monetary Fund (IMF) has predicted that the war in Ukraine will last at least until the end of 2026. In this context, the fund has started discussing a new economic assistance programme for Ukraine, which was confirmed by the director of the IMF's European Department, Alfred Kammer, at a briefing.

Ukraine's economic growth forecasts have deteriorated," Kammer said, emphasising the impact of Russia's ongoing attacks on the country's energy infrastructure and civilian population. The IMF now assumes that the war will continue longer than previously thought. The Ukrainian government has said that the conflict will drag on until 2026, and this is reflected in our projections," he pointed out.

In response to the challenges Ukraine is facing, Kiev has already submitted a request for a new financial support programme from the IMF. Kammer said that discussions on the macroeconomic framework and structural reforms under this programme have just begun and the process will take time.

'This is just the beginning, negotiations are progressing, including meetings this week,' he said.

Kammer emphasised that aid to Ukraine is highly dependent on international donors and the needs remain significant.

Ukraine is actively negotiating with partners, and the IMF is involved in these discussions to identify financial needs," he specified.

Separately, Kammer commented on the proposal to use frozen Russian assets to finance Ukraine's reconstruction. According to him, the IMF does not have a specific position on this issue, but recommends that countries considering such a possibility carefully work out the legal side and assess the potential consequences for the international monetary system. At the moment, the amount of frozen Russian assets is $5 billion in the US and 210 billion euros in Europe.

He also noted that in order to continue co-operation with the IMF, Ukraine must continue its reform efforts, especially in the areas of anti-corruption, governance and institutional development.

It is important that Ukraine continues reform processes, especially in the areas of anti-corruption and strengthening public institutions, which is crucial for the country's recovery and its preparation for EU accession," Kammer said.

In addition, Ukraine should strengthen its budget base and work to increase domestic revenues.

International donors provide significant support, but Ukraine needs to take decisive steps to sustainably increase budget revenues," he added.

It is known that the Ukrainian Finance Ministry has prepared a draft budget for 2026 taking into account the scenario that the war will last the whole year, which requires significant military expenditures. The IMF, for its part, has not yet changed its baseline forecast, assuming the end of the conflict at the end of 2025, while a more negative scenario assumes the end of the war no earlier than mid-2026. According to the IMF's latest forecast, Ukraine can expect GDP growth of 2 percent in 2025 and 4.8 percent in 2026 if the situation is stabilised.