Monday, 30 March 2015

Ukraine Looks to Squirm out of Debt Obligations

From: http://ift.tt/1NsYa0q

The dispute in Ukraine is certainly destabilizing the geopolitical state of affairs of the entire entire world. That is laying open the fear among the american aristocracy with regard to their undertakings to dominate the world while the us dollar still have an importance. The western primary press makes a pitch for the international elite group in their pushes in order to get rid of President Putin. Not since the zenith of the cold war has the black-painting of Russia and its head of state been this publicly shown. Just an uninterested or totally brainwashed woman will dodge to detect the mendacious story directed from american rulers to the proprietors as well as publishers connected with the company press in the USA and Europe. This is only another more scenario on by what means the yarn differs. I realise in what way bothersome it is to penetrate the image of Russia as plotted by european reporters. The european propaganda works but just on folks who are faraway from experiencing the reality. You might have got a glimpse of a completely different country than the one described to you by the journalists at home if you visited Russia during the last ten years.





The article originally appeared at German Economic News. Translated for RI by Anita Zalaldinova




Since the beginning of the crisis, Ukraine has received several loans from the IMF and the EU. These loans must be repaid only in a few years. However, the financial situation of the country remains vulnerable. Over the next four years overdue debts totalling $15 billion are to be paid. Three billion of them are a former loan from Russia and it needs to be paid in December of this year. The IMF could prevent it.


The IMF has developed a program for Ukraine with which the current financial hole is to be filled with a loan in the amount of $40 billion. The due debts are part of the plan – they should be restructured. The IMF has not yet said how it would look exactly. Experts reckon that the IMF believes that Russia should participate in a kind of debt cut, the FT reports. "It is clear that the IMF requires Russia's $3.5 billion bond issue to be included in the restructuring”, said the FT Charles Blitzer from Blitzer consulting who used to work for the IMF.


However, the plan of the IMF does not make it clear how large the debt cut will be, says Blitzer. "It is up to the Ukrainian authorities to determine the extent and nature of the debt restructuring", said a spokesman for the IMF. Sources close to Government expect a planned debt reduction of 50 percent. "But creditors rather try to agree on a term extension”.


Whether the international creditors accept a debt cut and if so, then to what extent it will be reduced, is not yet clear. Last week, Russian Finance Minister Anton Siluanow said that Russia still expect that the debt would be repaid in December in full. And Frank Templeton, the largest bondholder of the country, has brought legal help for debt negotiation in Blackstone.


Last week the Ukrainian Finance Minister Natalija Jaresko said the WSJ that the loans pledged so far would not be enough to bring Ukraine back on its feet. "The package will stabilize the banking system but it is not enough to seriously re-stimulate growth”, said Jaresko. "I need more support." “No one currently pays more to protect the world from a nuclear power”, and "if our partners, for whatever reason, are not able to assist us with defensive military means, they should provide more financial assistance".


Just on Friday the Ukrainian Central bank had to declare three other banks insolvent. The VAB Bank, Astra Bank and the City Commerce Bank are deprived of their licenses. At the same time, Ukraine is already planning an expansion of military resources. In sum, a total of 3.8 billion dollars will be spent on armaments in 2015.





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