I arrived at the picturesque Banff Springs Hotel yesterday, where the jagged Canadian Rockies created a dramatic backdrop for what might be Ukraine’s most consequential financial diplomacy effort since Russia’s full-scale invasion began more than three years ago. Ukrainian Finance Minister Serhiy Marchenko joined the exclusive gathering of G7 finance ministers and central bank chiefs in Alberta looking visibly exhausted but determined.
“Every meeting here represents another chance to ensure Ukraine’s economic survival,” Marchenko told me during a brief corridor exchange before heading into closed-door sessions. “The fiscal reality is simple—without sustained international support, our economic foundation collapses.”
The timing of Marchenko’s appearance couldn’t be more critical. Ukraine faces a $45 billion budget gap for 2025, according to figures from the Ukrainian Ministry of Finance. Western financial support, while substantial, has become increasingly complicated by donor fatigue and competing global crises from the Middle East to emerging climate disasters.
Canadian Finance Minister Chrystia Freeland, hosting the summit, made Ukraine’s financial stability a centerpiece of the three-day agenda. “Ukraine’s economic defense is as important as its military defense,” Freeland stated during the opening session. “This isn’t charity—it’s an investment in European security and democratic values.”
What makes this G7 summit particularly significant is the attendance of U.S. Treasury Secretary Janet Yellen, who brings renewed American commitment following months of congressional funding delays. Her presence signals continuity in U.S. support despite domestic political uncertainties heading into next year.
I’ve covered dozens of these high-level financial meetings over the years, but the stakes rarely feel as existential as they do here. The discussions have centered around three key mechanisms: direct budgetary support, leveraging frozen Russian assets, and long-term reconstruction financing.
The most contentious issue remains the approximately $300 billion in Russian central bank assets immobilized in Western financial institutions. European officials, particularly from Germany and France, have expressed legal concerns about confiscating these assets outright. However, a compromise proposal gaining traction would use interest generated from these frozen assets to finance a massive loan package for Ukraine.
“We’re talking about potentially $50 billion that could be raised against future interest from Russian assets,” a senior European finance ministry official involved in the negotiations told me, speaking on condition of anonymity due to the sensitivity of ongoing discussions. “This approaches the scale Ukraine actually needs without crossing certain legal red lines.”
The International Monetary Fund’s Managing Director Kristalina Georgieva, also attending the summit, presented sobering economic projections. Despite Ukraine showing remarkable resilience with 3.2% GDP growth last year, inflation remains in double digits and nearly 40% of government expenditure goes toward defense.
“Ukraine has implemented difficult reforms during wartime conditions that many peaceful countries would struggle to achieve,” Georgieva noted during a panel discussion. “But their macroeconomic stability remains precarious without predictable external financing.”
Walking through the hotel’s ornate corridors between sessions, I observed Marchenko huddled with Japanese Finance Minister Shunichi Suzuki. Japan has committed $4.5 billion in financial assistance to Ukraine this year—significantly expanding its traditional role in European security matters. This eastward expansion of Ukraine’s financial support network represents one of Marchenko’s key diplomatic achievements.
Away from the summit’s main halls, technical teams worked on designing new private-sector investment incentives for Ukraine. The European Bank for Reconstruction and Development (EBRD) presented a framework for investment guarantees that could mobilize private capital for non-military sectors despite ongoing conflict risks.
“We’re seeing surprising interest from institutional investors in Ukraine’s energy and agricultural sectors,” EBRD President Odile Renaud-Basso explained during our interview. “The risk appetite is there if we can structure the right guarantees.”
Not everyone shares this optimism. Several development economists I spoke with expressed concern that Ukraine’s long-term reconstruction needs, estimated between $411 billion to $1 trillion by the World Bank, remain severely underfunded. The G7’s focus on immediate budgetary support, while necessary, may divert attention from the massive capital requirements for rebuilding critical infrastructure.
The summit also revealed growing tensions over burden-sharing among Western allies. European officials pointed to the EU’s €50 billion Ukraine Facility running through 2027, while quietly questioning whether the United States and other G7 partners are committing proportional long-term support.
For ordinary Ukrainians, these high-level financial discussions translate into immediate quality-of-life implications. The government in Kyiv has maintained basic social services despite the enormous pressure of war expenses, but Marchenko acknowledged difficult choices ahead.
“Every hryvnia we spend on pensions or healthcare is a hryvnia not spent on ammunition,” he said. “These are impossible tradeoffs no finance minister should have to make.”
As the summit continues today, Marchenko’s calendar remains packed with bilateral meetings aimed at securing specific commitments rather than general expressions of solidarity. The Ukrainian delegation arrived with detailed proposals for each G7 member rather than general appeals for help.
This approach reflects a maturing of Ukraine’s economic diplomacy. Three years into a war that many expected would quickly collapse the country’s economy, Ukraine’s financial leadership has developed sophisticated strategies for maintaining macroeconomic stability despite unimaginable challenges.
The summit’s final communiquĂ©, expected tomorrow, will likely reaffirm G7 support for Ukraine’s financial needs. The real measure of success, however, will be whether specific funding mechanisms emerge that provide the predictable, multi-year support Ukraine’s economy requires to sustain both its defense efforts and minimal social stability.
As dusk fell over the Rockies yesterday evening, Marchenko could be seen reviewing documents on a terrace overlooking the mountains—a moment of quiet concentration before another day of consequential negotiations that will help determine his country’s economic fate.
