Yatsenyuk announced at a televised government session December 18 a “moratorium” on any debt repayments to Russian Federation.
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Moscow has said it will take Ukraine to court if it fails to pay on time. Payments are frozen “until our proposals on restructuring are accepted or until a relevant court decision is made”, he said. That offer fell through earlier in December, and Russian finance minister Anton Siluanov said on December an out-of-court settlement may be “impossible”. “We are ready for court proceedings with Russian Federation”.
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However, the International Monetary Fund has recently changed its policy on such debts, leaving the door open for Ukraine to keep borrowing even if it falls behind with the repayments.
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“From today we are halting payments on this debt”, he said, essentially confirming that Kiev will default on the bond when the Sunday payment deadline arrives.
Meanwhile, the IMF criticized the Ukrainian government Friday, expressing concerns that the country’s parliament might reject a tax overhaul plan that would unlock the latest tranche of much-needed funds from the lender’s $17.5 billion bailout program.
The two sides have been engaged in a dispute over the Dollars three-billion loan given by Moscow the government of former Ukrainian president Viktor Yanukovych shortly before his ouster in 2013.
But Russia, whose political relations with Ukraine are at rock bottom, has refused to accept these terms, insisting the bond is an official country-to-country loan, not commercial debt.
“This is absolutely incorrect”, Peskov said after a journalist asked him if it was possible to say that Russian military specialists were present in southeast Ukraine at some point of the conflict there.
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Ukraine’s economy has struggled over the past few years and the country has negotiated repayment terms with creditors, but not with Russian Federation.
