By John Helmer, published on his blog ‘Dancing with Bears’, Dec 15, 2014
MOSCOW–Multi-billion dollar lending to Ukraine by the International Monetary Fund (IMF) and World Bank has stopped amid growing doubts among country directors at the two international organizations that the Ukrainian Government can meet repayment commitments and loan covenants for 2015, or deliver on reform promises and budget financing targets tabled in Kiev this week.
For the first time since the change of government in Ukraine last February that led to civil war in the east of the country, European bankers and multilateral fund sources acknowledge that Kiev is now likely to default on its international debts and will seek a reorganization of its bond debt. This will hit Franklin Templeton, the US investment fund which has accumulated up to $9 billion in Ukrainian bonds on a wager to make a $4 billion profit–provided the US Government would guarantee full and timely repayment.
IMF officials refuse to elaborate on the new terminology which the Fund began issuing last week to describe the suspension of cash disbursements under the Fund’s existing $17.1 billion programme, started last May. For the fine print of the IMF programme, read this and more…
Read the full article at the weblink above.
