US President Joe Biden has sent a $105 billion funding request to Congress, which includes a significant reduction in the monthly subsidy to the Ukrainian government. According to documents released on Friday, the aid to Ukraine would be lowered from $1.1 billion to $825 million per month. This reduction is part of Biden’s strategy to bundle funding for Ukraine, Israel, Taiwan, and the US border, in order to secure bipartisan support in Congress.
The White House Office of Management and Budget (OMB) sent a 69-page proposal to the Acting Speaker of the House, Patrick McHenry, outlining the funding allocations. Under this proposal, Ukraine would receive $61.4 billion in aid, while Israel would receive $10.6 billion.
One of the key revelations in the OMB document is that the US has been providing $1.1 billion per month to Ukraine through the Economic Support Fund program. This funding has been crucial for Ukraine to address budget shortfalls and pay government employees. The OMB request states that the new funding would provide a “glidepath” from $1.1 billion to $825 million per month, amounting to a total of $11.775 billion. These numbers are based on the latest estimates of Ukraine’s 2024 budget by the International Monetary Fund (IMF) and assumptions of support from other donors.
The reduction in aid to Ukraine comes amid concerns about Russia’s intentions in the region. The OMB letter highlights that Russia is actively seeking to undermine Ukraine’s economy in order to secure its surrender. The funding would be provided through the World Bank as reimbursements for authorized and verified expenditures, in line with the current conditionality framework developed by the US.
In addition to the cuts in monthly subsidy, the OMB proposal also includes other notable requests. These include changing the drawdown limit for military aid from $100 million to $7 billion and doubling the loan guarantees for Ukraine from $4 billion to $8 billion. The OMB emphasizes that Congressional action is necessary to ensure that Ukraine’s battlefield needs are met and its people are protected. The funding previously approved by Congress is running out, according to Biden’s National Security Advisor, Jake Sullivan.
However, the approval of this funding request may face challenges in Congress. The House of Representatives has been without a speaker since October 3, when Kevin McCarthy was removed due to a rebellion by some Republicans. McCarthy’s alleged secret deal on Ukraine funding with the White House was reportedly the cause of this rebellion. As of now, a replacement for McCarthy has yet to be elected.
In conclusion, Ukraine is set to receive a reduced monthly subsidy of $825 million under President Biden’s funding request to Congress. This funding is essential to support Ukraine’s economy and government operations, and to counter Russian aggression in the region. However, the approval of the funding request may face obstacles in Congress, with the absence of a Speaker in the House of Representatives.