Will Ukraine Be Able To Pay the Bills?


Ukraine is approaching payments for public debt. Over the next three years, the government will have to pay $21 billion to creditors. Russia may also add problems if the country wins a $ 3bn deal in the London court. Let us remind you that Ukraine has not repaid in 2015 due to the annexation of the Crimea and the invasion of Russian troops in the Donbas.

The question of how Ukraine will survive the peak payout years is still open, Dmytro Boyarchuk, Center for Socio-Economic Research CASE Ukraine`s executive director, comments to ‘RBK-Ukraina’.

In his opinion, there are two options.

‘We may be very fortunate and expect high resource prices in world markets. That will cause good currency earnings, coming investments and foreign exchange reserves that will make it possible to pay.

If this scenario does not justify itself (investors are still looking very cautious at Ukraine), then only the IMF and the high risks of another debt restructuring remain’, Boyarchuk said.

However, it is too early to discuss the ways of restructuring, the commentator clarifies.

According to the expert, the government will accurately pay the bills before the elections. ‘I think that until the presidential and parliamentary elections everything is quiet: the situation will be kept at all costs. I do not know, however, at what price. Nevertheless, declaring a default or restructuring (in this situation, it is the same) before a vote is a political suicide. After the elections in 2020, there can be a variety of options, depending on the status quo in the gold and foreign currency reserves’.

September 5, 2017