Why is Ukraine’s public debt growing?

According to the Ukrainian Parliament’s Finance Committee, in April 2025 public and state-guaranteed debt increased by 5%, reaching $180B; from January to April, public debt grew by 8.4%. Almost all of this debt growth is attributed to an increase in money owed to the EU, amounting to $13.1B.

The reasons for the rise in debt include:

1. The euro has strengthened against the dollar by over 10% since the beginning of the year, leading to a revaluation of the dollar equivalent of debt issued in euros.
2. Financing attracted under the G7 ERA initiative, which will be repaid with funds from frozen Russian assets, although these are considered contingent debt obligations.
3. Preferential macro-financial assistance received from the EU totaling $3.3B as part of the Ukraine Facility.

Meanwhile, due to a slowdown in government bond auctions, direct domestic public debt has decreased in hryvnia by 1.8% (-₴33.4B). Currently, the structure of public debt is as follows:

1. 74.5% – external debt, 25.5% – internal
2. 76.4% – foreign currency debt, 23.6% – hryvnia debt
3. 67.7% – fixed-rate debt, 32.3% – variable-rate debt