IN FOCUS: Ukraine & Moldova Brief

Review of February 2026

Petra Bošková, Anna Gúliková, Igor Píš, Martin Tancer, Martin Lukáč

UKRAINE

 Photo: Shutterstock.com

Potential of the Deployment of British (or Other Foreign) Official Non-Combat Troops in Ukraine

As the peace talks between Russia and Ukraine continue, partners of Kyiv are starting to discuss the possibility of this peace being under the supervision of the third parties’ armies. However, this might not be acceptable for Moscow, as they see the West as one enemy that is supporting extreme narratives in Ukraine. On the other hand, some representatives of Western countries see the situation differently, indicating that maybe the time has come to cross Russia, even though it presents risks, but also puts the West and mainly Europe into the position of a strong player. The troops could be stationed in the regions of relative peace and support the Ukrainian army and other services in non-fighting roles, just to show the Kremlin that it does not need to be a policy of appeasement all over again.

President Zelenskyy has already spoken on the topic of this foreign deployment at the very beginning of 2026. He confirmed that such plans are being prepared both on the Ukrainian and the European countries’ side, but cannot be used unless there is a solid peace deal on the table or at least a ceasefire deal between Russia and Ukraine. However, Moscow has been very reluctant to discuss the options for the potential ceasefire, as it would put the country in a position of worsened circumstances, because even though their advance is slow, it has still been constant. Still, the topic of engagement of foreign armies has not been openly introduced to the public discussion and based on the statistics of opinions on the whole conflict, this might cause an issue for many.

At this time, quite a few high representatives from Great Britain have come forth addressing this topic, and their support in the matter has been quite obvious. According to the UK Defence Secretary John Healey, the responsibility of deploying troops to any country feels very heavy for any country official, however, in this case, it would mean that the Russian war in Ukraine has finally come to an end. Such an act would strongly imply either a peace agreement or at least a movement in the peace negotiations towards conflict resolution. The UK’s interest and involvement is based on the fact that a strong and secure Europe requires Ukrainian territorial and political sovereignty from Russia for good.

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Ukraine’s State of Economy After Four Years of War

 Ukraine’s economy has entered a phase of “forced normality”, as the war with Russia enters its fifth year. Despite an initial 29,1% GDP collapse in 2022, the country has maintained macroeconomic stability through remarkable resilience and massive external support. While nominal GDP has reached $210 billion, surpassing pre-war levels, the economy remains approximately 17% smaller in real terms than before the invasion.

The European Bank for Reconstruction and Development (EBRD) reports that growth reached 2,0% in 2025. However, the 2026 growth forecast was recently downgraded to 2,5% as expectations for a ceasefire fade and wartime pressures persist. This stability is anchored by over 110 billion EUR in committed external financing for 2026-2027, which ensures the continuity of public services and defence spending.

Russia’s targeted attacks have damaged or destroyed all 15 thermal power plants, causing their share of the energy mix to collapse from 23,5% to just 5%. During the harsh 2025-2026 winter, millions endured rolling blackouts lasting 12 to 18 hours, forcing record electricity imports from neighbouring countries.

The demographic outlook is equally critical. Ukraine’s population has fallen to roughly 31 million, with up to 8 million people living abroad. The workforce has shrunk by a quarter, leaving 83% of companies facing staff shortages.

Ultimately, Ukraine remains tethered to Western aid. With lifelines like the 90 billion EUR EU package facing political hurdles, the economy’s survival remains a feat of endurance against unprecedented logistical and human constraints.

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Ukraine Makes the Biggest Territorial Gains Since Summer 2024

As the fifth year of the war began on February 24, the Ukrainian army made headlines about new territorial gains for the first time since they surprised the world with an invasion into the Kursk Oblast in Russia. The new gains are not too big, but analysts and news outlets were quick to point out why they matter.

As the Institute for the Study of War (ISW) writes in its report, the Ukrainian army managed to push the Russians away on two significant spots – in Kupyansk (Kharkiv Oblast) and near Oleksandrivka and Hulyaipole on the southern front. The strategically more important of the two is Kupyansk, an important railway junction which Ukraine recaptured in September 2022 and managed to hold ever since. The Ukrainian army seized at least 183 square kilometres around the city. On the southern front in the Zaporizhzhia and Dnipro Oblasts, the Ukrainians gained around 200 square kilometres thanks to advances during February. These successes can reportedly be attributed to two main factors, which make the communication and coordination of Russian forces more difficult – the decision of Elon Musk to cut his Starlink service for Russian troops and the attempt of the government to restrict the use of Telegram, a popular messenger which even the Russian army uses to communicate.

The ISW is sceptical whether these limited counterattacks could result in a larger offensive, which Ukraine has not attempted (at least on its territory) since the summer of 2023. Nevertheless, it is symbolic that these attacks occurred during the fourth anniversary of the war.

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IMF Approves $8.1 Billion Facility to Stabilise Ukraine’s Wartime Economy

Ukraine received a major financial boost on February 26, 2026, as the International Monetary Fund (IMF) approved a $8.1 billion, four-year Extended Fund Facility (EFF) to support the country’s war-strained economy. An immediate $1.5 billion disbursement will help Kyiv address urgent fiscal pressures as the conflict with Russia enters its fifth year and budgetary needs remain exceptionally high.

According to the IMF, the program is designed to stabilise public finances, restore medium-term external viability and anchor structural reforms under extraordinarily challenging circumstances. Key priorities include strengthening tax collection, broadening the revenue base, improving governance standards, safeguarding financial stability and reinforcing anti-corruption mechanisms. The reform agenda is also closely linked to Ukraine’s long-term objective of European Union accession, with the program serving as a macroeconomic anchor during wartime. The new arrangement forms part of a wider international assistance framework estimated at over $130 billion, combining support from the EU, G7 and other bilateral partners.

The Fund cautioned that risks remain elevated, particularly given uncertainty surrounding the security situation and external financing flows. Sustained reform momentum and prudent fiscal management will therefore be essential to maintaining confidence and unlocking further tranches of support.

The IMF decision comes amid renewed political tensions within the European Union. Hungary recently blocked and vetoed a proposed €90 billion EU assistance package and additional sanctions against Russia, accusing Ukraine of deliberately slow repairs to the damaged Druzhba pipeline, which carries vital supplies of Russian oil to Hungary. The dispute has raised questions about the predictability of future EU funding streams. Therefore, to sum it up, the IMF package provides immediate liquidity and policy credibility, Ukraine’s broader financial outlook remains closely tied to continued Western unity.

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MOLDOVA

Group of Hooded Hackers Shining Through a Digital Russian Flag. Photo: Shutterstock.com

Revoked Pardon in Moldova of the Suspect in the Ukraine Assassination Case

A joint investigative team of the Moldovan police and Ukrainian law enforcement is conducting a criminal investigation into an alleged plot of assassination of a few Ukrainian high representatives and other public figures by an organised criminal group. Based on the information provided by the Moldovan police, these allegations of such acts were supposed to be coordinated under the control of the Kremlin and the Russian intelligence. During the house searches in the targeted locations in Kyiv and Odesa, law enforcement found weapons, equipment, ammunition and communication devices, which were intended to be used in the potential assassinations. This international investigation had to be carried out in a highly professional and coordinated manner between the Moldovan and Ukrainian services.

According to the prosecutors active in this case, the criminal group was targeting mainly active military personnel from the Main Intelligence Directorate of Ukraine’s Ministry of Defence, fighters from the Foreign Legion, the head of a strategic state-owned enterprise and a widely known journalist, who was labelled as an “extremist” in Russia. Two men of this group were sent to Kyiv at the end of 2025, pretending to work there as food couriers, meaning to gather as much information as possible about the potential victims and work out the area grounds necessary to be known, following their movements and lifestyles. The head of the recruitment found another 11 people to take part in the murders or the whole assassination plot, providing them with weapons and ammunition, overlooking the rounds on the locations and the area. This man was Nicolae Andrei Sepeli.

Sepeli was identified by the authorities as a Moldovan national who was convicted in 2017 for drug trafficking in Russia and, in 2019, was transferred to Moldova to serve his recommended sentence. However, in 2022, he was released after the presidential pardon from Maia Sandu, which followed his own petition and the one from the prosecutor’s office. After the change in the circumstances of Sepeli provided by Moldovan services, Sandu revoked the decision to pardon him. Three persons caught in Moldova are now placed in custody for 30 days, as they are being investigated for collecting information about the potential victims in order to organise their subsequent physical elimination for the gain of financial reward.

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The EU’s Helping Hand in an Energy Crisis

 On February 4, 2025, the European Commission and the Republic of Moldova agreed on a two-year Comprehensive Strategy for Energy Independence and Resilience. This strategy is designed with the primary objective of decoupling Moldova from its dependence on insecure Russian energy supplies and ensuring its full integration into the EU energy market.

The agreement comes as a response to a severe energy crisis that escalated on January 1, 2025, when the Russian state-owned company Gazprom ceased gas deliveries to the Transnistrian region via Ukraine. Because Moldova relies heavily on power plants in this separatist region, the gas disruption threatened the electricity supply for the entire country.

 To combat this, the EU has committed 250 million EUR in support for 2025. This is in addition to a 30 million EUR emergency package mobilised in January for urgent gas and electricity purchases. Furthermore, an offer of 60 million EUR is available for the people of Transnistria, though this support is strictly conditional on progress regarding human rights and fundamental freedoms in the region.

 The strategy focuses on immediate relief for consumers facing steep price increases. Until the end of 2025, the EU compensated excess electricity costs for households consuming up to 110 kWh per month, as well as for social institutions like schools and hospitals. The plan was implemented in three phases: 1. Emergency support for immediate energy purchases, 2. Financial assistance to alleviate winter energy bills through April, 3. Long-term investments under the Moldova Growth Plan.

Commissioner Marta Kos noted that this strategy will not only stabilise the country but also accelerate Moldova’s integration into the EU by permanently linking its energy destiny to the European system.

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EBRD and IMF Signal Modest Growth as Moldova Faces Structural Headwinds

Fresh assessments released in late February by the European Bank for Reconstruction and Development (EBRD) and the International Monetary Fund (IMF) paint a cautiously restrained picture of Moldova’s economic trajectory. While both institutions acknowledge signs of recovery after successive external shocks, they warn that structural vulnerabilities and fiscal pressures continue to weigh on medium-term prospects.

The EBRD has revised its 2026 growth forecast for Moldova downward to 3.0 per cent, trimming its previous projection. The adjustment reflects weaker external demand, persistent regional uncertainty linked to Russia’s war against Ukraine, and the country’s structural constraints. Although growth is expected to remain positive, the bank’s outlook signals that Moldova’s rebound is fragile and still heavily dependent on external financing and reform implementation.

EU financial support remains a stabilising factor, helping cushion the economy against energy volatility and geopolitical risks. However, the relatively moderate growth projection suggests that Moldova has yet to transition from recovery to sustained expansion. The EBRD’s assessment underscores the importance of accelerating structural reforms to strengthen competitiveness and investment confidence.

Parallel to this, the IMF concluded its 2025 Article IV consultation with Moldova, offering a similarly cautious evaluation. The Fund projects real GDP growth of approximately 2.7 per cent in 2025 and around 2.3 per cent in 2026, supported by domestic demand, agricultural performance and continued European assistance. Yet it emphasises that longstanding structural weaknesses—including limited productivity, labour outflows due to emigration, and institutional capacity gaps—continue to constrain potential growth.

Fiscal dynamics represent another area of concern. The IMF anticipates a widening fiscal deficit in 2026, driven by higher public investment and reform-related spending. While these expenditures are intended to support long-term development and EU alignment, they require prudent management to safeguard macroeconomic stability. Monetary policy, meanwhile, must remain cautious amid lingering uncertainty surrounding inflation and external shocks.

In sum, Moldova’s outlook for 2026 remains positive but modest. Growth is expected to continue, yet below earlier expectations and vulnerable to external headwinds. The coming year will likely test the government’s capacity to translate European support and reform commitments into tangible economic transformation.

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Moldova Takes Further Steps for the Future Reintegration of Transnistria

Moldovan Deputy Prime Minister for Reintegration Valeriu Chiveri announced on February 11 that the government in Chisinau is planning to create a so-called “Convergence Fund” as a step to further integration with the separatist region of Transnistria. Money from the Fund should be used to finance different social and infrastructural projects in the region.

The Fund should be financed by some domestic sources as well as European money, and it should be implemented after August 1, 2026. However, Polish expert Kamil Całus from the Centre for Eastern Studies (OSW) pointed out that the Fund is, according to his opinion, mainly a tool to show the EU that Moldova is taking the issue of integration seriously. The small country currently does not have the financial or human resources to prepare a serious plan for reintegration and is focusing more on speeding through the EU accession process. Moreover, it is not clear how the authorities in Chisinau want to finance projects in Transnistria without the permission of the separatist authorities, which still see the Moldovan government as an adversary.

The OSW points out that the reintegration of Transnistria may more probably be triggered by an economic and financial collapse of the region, which has been in a severe crisis for over a year due to drastic cuts in Russian gas supplies. However, until now, the existence of Transnistria remains one of the most crucial obstacles on Moldova’s way to the EU.

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