(Reuters) - Ukraine is doing everything it can to either declare its $3 billion bailout bond held by Moscow invalid or to not repay its debts, Russian Finance Minister Anton Siluanov told Reuters on Thursday.
Russia bought $3 billion worth of Ukraine's Eurobonds in December, before relations between the two plunged to new lows when Ukraine's pro-Russian president was toppled. Since then Moscow has annexed Ukraine's Crimea region and pro-Russian rebels have fought Ukrainian forces in eastern Ukraine.
On Thursday, Ukraine's security service opened a criminal probe into former Finance Minister Yuriy Kolobov over the Russian bailout, saying Kolobov - among others - had abused his office and violated the budget law by organizing the bond sale.
"It seems that the main reason behind the case, behind the hype around it, is that Ukraine sees that it violated one of the loan conditions and wants to do everything to declare this loan either invalid or to find reasons not to repay its debts," Siluanov told Reuters by phone.
He added that the Finance Ministry will wait for Ukraine's official statistics for the overall debt of government level for the first three quarters before deciding whether to ask Kiev for an early repayment of the bond.
Ukrainian officials were not immediately available to react to Siluanov's comments. One of the conditions of the bailout program stipulates that the "total state debt and state-guaranteed debt should not at any time exceed an amount equal to 60 percent of the annual nominal gross domestic product (GDP) of Ukraine".Siluanov said that because of the hryvnia's devaluation, the threshold has already been crossed.
The International Monetary Fund predicts that debt-to-GDP will top 67 percent by end-2014. A recent selloff on Ukraine's dollar debt has focused attention on the controversial $3 billion bond, raising investor concerns that President Vladimir Putin could use the issue to trigger a cascade of defaults across Kiev's sovereign Eurobonds.
"Based on unofficial - and I repeat, unofficial data - this debt level has already been crossed," Siluanov said. So, he said, there is every reason for Russia to be able to claim the early repayment of this debt. "We will wait for the official statistics, then we will decide on our course of action."
He added that Ukraine has been servicing the debt, so it considers the debt valid. In early June, Kiev made a $73.3 million coupon payment on the Eurobond.Siluanov said he regretted the souring in relations between Moscow and Kiev.
"We would like to have an honest conversation with our neighbors and we will communicate on this subject regarding all repercussions and further investigation of the case," Siluanov said.
reuters.com
Russia bought $3 billion worth of Ukraine's Eurobonds in December, before relations between the two plunged to new lows when Ukraine's pro-Russian president was toppled. Since then Moscow has annexed Ukraine's Crimea region and pro-Russian rebels have fought Ukrainian forces in eastern Ukraine.
On Thursday, Ukraine's security service opened a criminal probe into former Finance Minister Yuriy Kolobov over the Russian bailout, saying Kolobov - among others - had abused his office and violated the budget law by organizing the bond sale.
"It seems that the main reason behind the case, behind the hype around it, is that Ukraine sees that it violated one of the loan conditions and wants to do everything to declare this loan either invalid or to find reasons not to repay its debts," Siluanov told Reuters by phone.
He added that the Finance Ministry will wait for Ukraine's official statistics for the overall debt of government level for the first three quarters before deciding whether to ask Kiev for an early repayment of the bond.
Ukrainian officials were not immediately available to react to Siluanov's comments. One of the conditions of the bailout program stipulates that the "total state debt and state-guaranteed debt should not at any time exceed an amount equal to 60 percent of the annual nominal gross domestic product (GDP) of Ukraine".Siluanov said that because of the hryvnia's devaluation, the threshold has already been crossed.
The International Monetary Fund predicts that debt-to-GDP will top 67 percent by end-2014. A recent selloff on Ukraine's dollar debt has focused attention on the controversial $3 billion bond, raising investor concerns that President Vladimir Putin could use the issue to trigger a cascade of defaults across Kiev's sovereign Eurobonds.
"Based on unofficial - and I repeat, unofficial data - this debt level has already been crossed," Siluanov said. So, he said, there is every reason for Russia to be able to claim the early repayment of this debt. "We will wait for the official statistics, then we will decide on our course of action."
He added that Ukraine has been servicing the debt, so it considers the debt valid. In early June, Kiev made a $73.3 million coupon payment on the Eurobond.Siluanov said he regretted the souring in relations between Moscow and Kiev.
"We would like to have an honest conversation with our neighbors and we will communicate on this subject regarding all repercussions and further investigation of the case," Siluanov said.
reuters.com
No comments:
Post a Comment