Ukraine can not pay $3 billion Russian debt – 12/18/2015 2:06:25 PM
KYIV, Ukraine-Ukraine said Friday that it would suspend repayment of a $3 billion bond to Russia, a move that the Russian government earlier said would provoke legal action against Kyiv.
The moratorium will be in place “until the acceptance of our restructuring proposals or the adoption of the relevant court decision”, Mr Yatseniuk told his government.
The fund meanwhile expressed concerns Friday over parliament’s rejection this week of a draft budget for next year and a new tax code, saying that a balanced budget is a “key condition” for funding and deviating from it would “inevitably disrupt the associated global financing”.
Putin also said it was impossible to say whether the Russian officers, Yevgeny Yerofeyev and Alexander Alexandrov, would be exchanged for Ukrainian helicopter pilot Nadezhda Savchenko, filmmaker Oleg Sentsov, or other Ukrainians imprisoned or facing trial in Russia. Ukraine has said it has no intention to replay it.
Ukraine has included the two-year bond in the external commercial debt it is restructuring to shore up its war-torn economy.
“Ukraine remains committed to negotiating in good faith a consensual restructuring of the December 2015 Eurobonds”, the statement said.
The Eurobond matures on December 20, but Ukraine has a 10-day grace period before it will be considered officially to be in default.
It’s the latest spat between the two neighbours following a run of gas supply disputes, Russia’s 2014 annexation of the Crimean Peninsula and its support for separatists in eastern Ukraine.
But many of Kyiv’s government troops which are battling the insurgents also speak Russian, belying Moscow’s claim.
Prior to today’s default, Russian Federation had been softening its stance on the debt, with Putin proposing last month that Ukraine pay it back over three years so long as a Western government or bank provide a guarantee.
Cash-strapped Kyiv is in dire need of further global funding and was required by the IMF to restructure a total of 15.3 billion of debt to unlock the next installment of the 17.5 billion aid package.