The German government approved on 30 July its draft budget for 2026 and medium-term financial planning through 2029, which includes increased support for Ukraine, European Pravda reported.

According to the report, the draft federal budget for 2026 envisions expenditures of approximately 520.5 billion euros—3.5% more than allocated in this year’s budget. Borrowing is projected at nearly 174.3 billion euros, representing a 31 billion euro increase from current levels.

Government investments will reach a record 126.7 billion euros in 2026, marking an 11 billion euro increase from this year. This unprecedented figure for Germany became possible partly due to relaxed debt rules.

The budget expansion extends to defense spending, which will surge from 62.4 billion euros to 82.7 billion euros in 2026—primarily driven by weapons and ammunition procurement funding. According to the medium-term budget plan, Germany’s defense expenditures will gradually increase through 2029, ultimately reaching NATO’s target of 3.5% of GDP.

The 2026 budget allocates approximately 8.5 billion euros in military aid to Ukraine.

Budget discussions in the Bundestag will begin at the end of September, with both chambers of the German parliament required to approve the budget by year’s end.

The European Commission is discussing with EU member states various options to cover Ukraine's budget deficit for next year, which could range from $8 billion to $19 billion, the Financial Times reported on July 8.

International partners have provided Ukraine with over $39 billion for its wartime economy so far this year, Prime Minister Denys Shmyhal announced.

The financial hole in Ukraine's budget is linked to reduced U.S. support and the lack of prospects for a swift ceasefire with Russia that Europe had hoped for, the Financial Times reported.

A senior EU official told the publication that many of Ukraine's partners had previously counted on a peace deal in 2025, but are now forced to revise their funding plans.

This includes the European Commission, which has already adjusted spending from Ukraine-related funding streams.

Without support from Western partners, Kyiv would face a budget deficit of $19 billion in 2026, according to the Financial Times. However, even if additional international financing for the wartime economy can be secured, a gap of at least $8 billion would remain.

To support Ukraine's budget, Europe is considering providing military aid in the form of off-budget grants that would be recorded separately as external transfers but would count toward NATO member countries' national defense spending targets.

One EU diplomat told the Financial Times that military support for Ukraine is viewed as a contribution to the defense of all of Europe.

In a document for G7 countries reviewed by Financial Times, Kyiv proposed that European allies co-finance Ukrainian forces, framing this as a service to strengthen continental security.

Other support options under discussion include potentially accelerating payments from the existing $50 billion G7 loan program and reinvesting frozen Russian assets in higher-yield financial instruments that the EU allocated to help service the debt.

According to the Financial Times, two sources confirmed that the commission planned to discuss these options with EU finance ministers on July 8.

The funding issue will also be raised at the Ukraine Recovery Conference in Rome on July 10-11, dedicated to Ukraine's reconstruction needs. European Commission President Ursula von der Leyen will attend the event.

Trump can make Russia pay — not by deploying troops, but by taking action with what’s already in US hands. As detailed in a Forbes op-ed by Andy J. Semotiuk, after President Trump’s recent phone call with Vladimir Putin, the Kremlin rejected any peace and resumed bombing Ukraine.

Reports indicated that Russia launched nearly 5,500 missiles and rockets in June 2025 alone. Up to 1,000 drone strikes per day could hit Ukraine in August.

Even as the West backs Ukraine militarily, it continues buying Russian oil and gas — channeling far more money into Putin’s war machine than it sends to Ukraine, Forbes says. Since February 2022, Western energy payments have tripled the aid given to Kyiv. Russia, meanwhile, has inflicted over $552 billion in theft and destruction — looting grain, steel, industrial equipment, and flattening critical infrastructure.

Russia’s looting campaign has cost Ukraine over half a trillion dollars

According to Forbes, Russia has inflicted more than $552 billion in theft and destruction across Ukraine — seizing over 1,150 companies, looting grain and steel, and devastating infrastructure. These losses underscore the scale of Moscow’s economic war alongside its military one.

Forbes: Trump can’t stop the war with words — but he can with Russian money

Frozen Kremlin assets can fund Ukraine’s defense

Semotiuk notes that $330 billion in frozen Russian sovereign funds are sitting untouched in Western banks. Trump can make Russia pay by leading a legal effort to seize those funds — a move with precedent, as the US has done with Iraq and Afghanistan. That money alone could cover Ukraine’s defense and reconstruction for three years. Acting swiftly would likely push allies like Canada, the UK, and EU states to follow.

Historian Timothy Ash, quoted in the op-ed, estimates Ukraine needs $150 billion annually to secure victory. If it loses, NATO could face over $4.5 trillion in defense spending within a decade. Mass refugee waves, destabilized markets, and aggressive moves by China or North Korea would likely follow. Funding Ukraine now prevents far greater costs later — both financial and strategic.

Shift energy policy to isolate Russia and protect US interests

Semotiuk argues that supporting Ukraine also means cutting off Russia’s revenue stream. The US and its allies — especially Canada — have the capacity to replace Russian energy in global markets. That would boost Western economies and deny Putin the cash to wage war. Countries still purchasing Russian oil — including China, India, Türkiye, Brazil, and several EU members — should face strict US sanctions.

Ukraine has earned America’s support — and needs it now

For over 30 years, Ukraine has supported every major US military operation. In return, Washington pledged protection in the 1994 Budapest Memorandum, when Ukraine gave up its nuclear arsenal. Turning away now, Semotiuk warns, would shatter US credibility.

The op-ed notes that Ukraine has already inflicted immense damage on Russia’s military: over a million troops dead or wounded, the Black Sea Fleet decimated, and weapons facilities under constant attack. All without a single American soldier on the battlefield.