Already embroiled in a years-long conflict with Russia, the Ukrainian economy is experiencing new stress as the conflict in the Middle East escalates. As oil prices rise in response to the war in the Middle East, Ukraine could see inflation raising by 1.5 to 2.8 percentage points, according to Reuters. National Bank of Ukraine Governor Andriy Pyshnyi said Ukraine’s central bank would remain steadfast with their target of lowering inflation to 5%.

The Ukrainian central bank is in the process of assessing exactly how the war will impact economic forecasts, with boosted gas and fertilizers having the potential to stifle growth. Massive Russian strikes on Ukraine’s energy infrastructure are also depressing economic growth and fueling migration outflows as the war between Russia and Ukraine enters its fifth year.

While the flow of migration out of Ukraine is expected to cease once the conflict ends, Pyshnyi believes an extended conflict would complicate the return of the estimated six million Ukrainians living abroad. “The longer it lasts, the higher the risk of Ukrainians abroad to be assimilated,” Pyshnyi said, per Reuters.

The European Union (EU) has delayed a 90 billion euro after Hungarian President Viktor Orban blocked the loan due to a dispute over a war-damaged pipeline. With Orban voted out in recent Hungarian elections, a major roadblock to Ukrainian aid has been lifted. Following the news, the EU announced plans to disburse 2.5 billion to 2.7 billion euros to Ukraine once the nation’s parliament finished necessary reforms, according to Reuters.

“The chances that Ukraine will get the 90-billion-euro loan are 100% and we are already in contact,” Kos said, per Reuters. “Our president was speaking to ⁠the ​future, possible new prime minister of Hungary, Peter Magyar, and I think that ​we will be able to make this [happen] very soon.”

Ukrainian Finance Minister Serhiy Marchenko said the nation’s financing gap of $52 billion will be covered by the EU loans, once available, but the government is still unsure how to close the financing gaps in 2027. Marchenko previously said that the EU had helped Ukraine cover almost two-thirds of their financing needs, but it remains unclear whether other nations will assist in addressing the deficits.

Credit managers extending credit in Ukraine offer largely 1-30-day terms, according to FCIB’s Credit and Collections Survey, with customers paying 16 days late on average. All respondents with customers in Ukraine believe these delays are increasing due to shipping/supply chain issues (100%), foreign exchange rates (100%) or central bank issues (100%).

“More than ever the five Cs of credit are vital to properly set acceptable risk to the reward of making a sale and collecting on that sale,” one respondent wrote.

“If you extend credit into Ukraine, never rely solely on open-account terms, if possible,” another respondent wrote. “Instead, structure the sale so that payment security is built in from the start.”

“Conditions can shift quickly,” another respondent wrote. “Regular reviews are not excessive in this environment.”