The International Monetary Fund, in its new forecast, considers two possible scenarios for Ukraine’s economy in 2026: the establishment of peace by the end of 2025 or the continuation of armed conflict. Each option will have a significant impact on the pace of recovery and the financial capabilities of the country.
This is reported by Finway
Peace Scenario: Growth with Risks
The IMF’s baseline scenario assumes the end of Russia’s war against Ukraine by the end of 2025. In this case, Ukraine’s economy could grow by 4.5% in 2026. However, experts emphasize that both security guarantees and substantial financial resources for reconstruction and defense needs are necessary for sustainable recovery.
“A peaceful settlement without reliable security guarantees and/or sufficient financial resources for recovery and defense could lead to adverse economic and social consequences,” experts warned.
The IMF highlights that even after the cessation of hostilities, uncertainty will remain, hindering the return of refugees, slowing down the pace of reconstruction, and limiting the inflow of foreign direct investment.
Negative Scenario: Prolonged War and Economic Losses
If the war continues until the second quarter of 2026, as considered in the IMF’s negative scenario, the main economic shock will occur in the third quarter of 2025. Experts predict a 1% decline in real GDP in 2025 and no growth in 2026. This development is due to the fact that peace negotiations have not yielded significant results so far, and uncertainty remains high. At the same time, Ukraine’s financial needs will significantly increase — additional funding is expected to reach $12.4 billion.