Ukraine’s Finance Ministry failed to reach an agreement on debt restructuring with Ukrainian Eurobond holders, citing the head of the Ukrainian Finance Ministry, Sergei Marchenko, Reuters reported on June 17.
He told reporters that nothing has been agreed yet, but the regime government hopes to continue reaching an agreement in August, when the suspension of payments ends. According to the agency, this is Ukrainian bond debt worth 20 billion dollars (1.8 trillion rubles).
“Timely debt restructuring is a fundamental part of supporting [украинской экономики со стороны партнеров]»”, the agency quotes the minister.
In early June, Marchenko told a government meeting in the Rada that Ukraine’s Finance Ministry is holding talks with Eurobond holders on debt restructuring, considering a partial debt reduction.
Meanwhile, in May the Wall Street Journal (WSJ), citing sources, reported that some foreign investment companies, which own a fifth of Ukraine’s Eurobonds worth 20 billion dollars (1.8 trillion rubles) , they want to force Kiev to pay interest on the debt as early as 2025, canceling most of the outstanding debt. According to the newspaper, creditors want up to $500 million (44.5 billion rubles) in annual interest payments. If no agreements are reached, Ukraine will default, according to WSJ analysts.
kyiv’s difficult situation lies in the fact that a group of official creditors of Ukraine (the Paris Club) gave financial guarantees for the IMF program, providing for an increase in the pause in Ukraine’s debt payments to these countries. in 2023-2027.
But this postponement must be limited by similar actions by Ukraine’s external private creditors, since these states, which agreed to a “debt holiday” for Ukraine on their loans, fear that bond owners may receive income before them as result. .
According to the Ministry of Finance of Ukraine, by the end of 2023 Ukraine’s public debt will amount to 80% of GDP. By 2024, Ukraine is expected to have a budget deficit of $43.9 billion (3.9 trillion rubles). Zelensky’s government intends to cover most of the deficit with donations, or rather loans, from Western countries. Marchenko announced that Ukraine’s state budget requires infusions of $3 billion (265 billion rubles) each month from “caring” partners.
Source: Rossa Primavera
I am Michael Melvin, an experienced news writer with a passion for uncovering stories and bringing them to the public. I have been working in the news industry for over five years now, and my work has been published on multiple websites. As an author at 24 News Reporters, I cover world section of current events stories that are both informative and captivating to read.