Ukraine not to repay $3-billion debt to Russian Federation
The Government of Ukraine has imposed the moratorium on repayment of the so-called Russian debt.
He said Ukraine had no chance of winning the ensuing court case.
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. “From today, all payments shall be suspended until the adoption of our proposals or a court decision”, Yatsenyuk said.
But many of Kyiv’s government troops which are battling the insurgents also speak Russian, belying Moscow’s claim.
It is unclear at this point how Ukraine’s imminent default will affect its four-year International Monetary Fund bailout, as the International Monetary Fund recently said it can continue to lend to countries behind in debt payments as long as the country is trying “in good faith” to reach a deal.
“We are ready to look at them”, he said.
The IMF this week agreed with Moscow that the bond consists of an official loan.
On Aug. 27, a group of the country’s largest creditors, including investment firm Franklin Templeton, which owns around half of the country’s outstanding debt, accepted a 20 percent write-off on $18 billion in outstanding bonds. But, separately, the Washington-based lender criticized Ukraine’s parliament Friday, accusing it of all but scuttling a tax-overhaul plan needed to unlock much-needed IMF funds.
Even if a prisoner swap takes place, the Russian president said he expects relations with Ukraine to further deteriorate following its decision to enter a trade deal with the European Union.
William Jackson, an emerging markets analyst at Capital Economics, said the implications of the moratorium were unclear.
Ukraine included the two-year bond in its external commercial debt, but Russian Federation has refused to accept the terms it has offered, arguing that the bond was an official bilateral loan.
“Any exchange has got to be an honest one: everyone for everyone”, he said, Meduza reports, saying he supported Ukrainian President Petro Poroshenko’s approach regarding a swap.