IMF relaxes on debt restructuring

UKRAINE - In Brief 12 Jun 2015 by Dmytro Boyarchuk
It looks like on debt restructuring everything develops in line with our expectations. The IMF mission arrived in Kyiv and was pretty much pleased to see serious progress on many directions. Reforms are gradually moving on disregard incredible resistance. What more, it looks like the general situation has stabilized: budget revenues are booming, hryvnia strengthened and current accounts switched into surplus. At the eastern front also we see encouraging developments: successful repel of strong Russian attack on Mariyinka showed that defense line Ukraine has been building really worth something. All in all, with all those points the IMF faced a difficult choice: either to keep its line on restructuring (no money without successful debt operations) what possibly one more time would destabilize the country or… to give up with this requirement. David Lipton, First Deputy Managing Director of the IMF, informed on June 10th that the IMF decided to give up. Now we are facing a new question – will Ukraine pay on its debts after such a claim? Mr. Lipton said that the IMF will keep supporting Ukraine even if the country finds it can’t continue to pay its private creditors. Nominally this position gives green light to frozen debt repayments. Still we are not among believers that this will happen. The main reason is Russian debt. Firstly, Russians will never accept haircut. $3 billion is not a critical sum for Kremlin while it is important to create troubles for Kyiv. Should it happen that Ukraine does not pay, Moscow will go to the court and will speculate with this nonpayment in all possible ways for political reasons. Secondly, the status of the debt is not clear: none can say ...

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this or its contents.