Svyrydenko Takes the Helm: Economic Overhaul with Political Continuity in Kyiv

On Thursday, Ukraine appointed a new prime minister. Economist Yulia Svyrydenko faces a daunting task—she must accomplish two strategically vital goals: retain the trust of U.S. President Donald Trump’s administration and align Ukraine’s economy with the demands of the war effort.

Photo: Yulia Svyrydenko

Since the onset of Russian aggression, Ukrainian President Volodymyr Zelenskyy has been fighting a key battle at home. He aims to demonstrate to the public that changes at the top of the government can happen even during wartime—thus challenging narratives questioning his legitimacy after his mandate expired and while free elections cannot be held nationwide. For these reasons—and others—Zelenskyy has in recent years reshuffled leadership in both the government and the military.

In this latest shake-up, Zelenskyy dismissed Prime Minister Denys Shmyhal and replaced him with Yulia Svyrydenko (39), previously Deputy Prime Minister and Minister of Economy since 2021. Her appointment was supported by 262 of 450 members of the Ukrainian parliament, which is dominated by Zelenskyy’s party, Servant of the People.

Shmyhal, who served five years as prime minister—a record in Ukraine—will now head the Ministry of Defense, while outgoing defense minister Rustem Umerov will become Ukraine’s ambassador to Washington.

Retaining Trump and the West

Svyrydenko’s appointment came as no surprise. She was involved in EU accession negotiations and played a key role in a mineral agreement between Zelenskyy and Trump, which would give American companies post-war access to Ukrainian natural resources in exchange for Washington’s continued support. This deal could become a cornerstone of Ukraine’s economic and geopolitical future.

That deal reportedly helped keep Trump engaged with Ukraine—even after his infamous spat with Zelenskyy during the latter’s visit to the White House, a moment still fresh in many minds.

Svyrydenko is no newcomer to Ukraine’s top political circles. She previously served as Deputy Chief of Staff to the President, effectively the right hand of Andriy Yermak, one of the most powerful figures in Zelenskyy’s government. Yermak, along with intelligence chief Kyrylo Budanov, represents the younger generation of officials on whom Zelenskyy relies most heavily.

Well-known in the West, Svyrydenko’s experience and closeness to Zelenskyy’s inner circle were likely key factors in her appointment—already a challenging role under peacetime conditions, let alone during a full-scale war. Her name had already been floated as a potential future prime minister last year.

Western media commentators have praised her quiet and persistent work style and her ability to build bridges wherever possible—earning her wide respect across Western capitals.

War Economy

In a devastated Ukraine, the ability to forge connections is a prerequisite for nearly everything else. Russia has long shifted its war goals from “denazification” to deindustrialization—systematically targeting Ukraine’s infrastructure: energy facilities, factories, mines, ports, railways, and roads.

Svyrydenko must now not only rebuild but restructure the economy to serve wartime needs. Zelenskyy recently said the new government’s goal is to reduce Ukraine’s dependence on foreign weapons.

“Weapons made in Ukraine now account for about 40% of what’s used on the front lines,” Zelenskyy stated. “That’s already more than at any time in our independence. Our production volume is significant, but we need more. Our goal is to reach 50% domestically produced weapons within the first six months of the new government by expanding domestic manufacturing.”

This is no accident. Western countries are co-funding joint arms factories in Ukraine—a development Zelenskyy has praised as a step in the right direction.

Svyrydenko will receive important support from Shmyhal in his new role as defense minister. As an economist, he will be tasked with increasing efficiency in military spending. For comparison, recall that Vladimir Putin appointed economist Andrei Belousov as Russia’s defense minister in May 2023, giving him similar responsibilities.

This is an enormous challenge. In 2024, Ukraine allocated $53.2 billion—around 26% of its GDP—to defense. Experts estimate the country will need another $40 billion in international aid next year. Zelenskyy is betting that the Svyrydenko–Shmyhal duo will help secure it.

Ready for War, Preparing for Peace

War fatigue is setting in—not just in Kyiv and Moscow, but especially in Washington. Trump has been voicing this for months. Yet it remains unclear how to end the war, as neither side is willing to make concessions, especially regarding territory. Putin is trying to lure Trump into a trap—hoping to impose long-term conditional stalemates on Ukraine through negotiations.

The situation on the battlefield reflects this tension. There have been no major offensives from either side in some time. The war has shifted into a phase of resource attrition. Ongoing battles across Ukraine—and occasionally inside Russian territory—suggest both sides are anxiously awaiting Trump’s mediation proposals.

However, there is no guarantee Trump—or anyone else—can deliver peace. Trump has repeatedly said he dislikes Putin’s actions and has hinted at a new approach. This could either escalate tensions between Washington and Moscow or lead Trump to pull back, leaving Europe to manage the crisis alone.

That’s why Zelenskyy wants his new government to boost arms production, develop new weapons systems, mass-produce drones, and build defensive systems—while also reforming the economy to suit wartime conditions and lay the groundwork for post-war recovery.

The success of Svyrydenko’s government will be measured by its effectiveness on these fronts.

The article was previously published on nap.ba.

---