In Ukraine

New Cold, April 11, 2016

Two days following the resignation of Ukraine’s prime minister, Arseniy Yatsenyuk, and amidst conflicting reports as to whether the man touted to replace him, Volodymyr Hroysman, is truly interested in the job or not, Ukraine’s Verkhovna Rada (Parliament) has voted to extend indefinitely an end-date on moratoriums of payment of its external debts.

When the moratorium was voted 11 months ago, an end date of July 1, 2016 was set. The proposed law, approved by the Rada in first reading, sets no end date. Enclosed is one of the few news report on the story, from TASS. Western media is silent.

Four months ago, Ukrainian President Petro Poroshenko declared a cessation of payment of government as well as commercial debts of more than $3 billion owed to the Russian government and financial institutions. Those moves, leave alone the latest one, amounted to a default by the Ukrainian government of its debt obligations. But the IMF and other international financial institutions have conveniently ignored their own rules concerning debt defaulters and have turned a blind eye to the Ukrainian government decisions.

BBC reports on April 12 that the Rada make no decision on a new prime minister and government the day before. “The fact that there was no vote on Tuesday means that the main political parties have been unable to agree on the forming of a new government under Mr Groysman, the BBC’s Tom Burridge reports from the capital, Kiev. So Mr. Yatsenyuk remains, in name at least, as prime minister, our correspondent says.

“Reports had emerged late on Monday that Mr Groysman would not take up the post amid disagreements over the line-up of the new cabinet.”

Ukraine introduces indefinite moratorium on payments of foreign debts

From TASS, April 12, 2016

Session of Ukrainian Rada on Feb 16, 2016 (Gleb Garanich, Reuters)

Session of Ukrainian Rada on Feb 16, 2016 (Gleb Garanich, Reuters)

KIEV – Ukraine has lifted date limit restrictions from its moratorium on the payment of its foreign public debts, including a $3 billion debt to Russia. According to an explanatory note to the relevant draft law, 242 deputies of the Verkhovna Rada  voted for the bill. For the approval of the bill, 226 votes would be enough.

A temporary moratorium on payments on the foreign debt was voted in May 2015 and was valid until July 1, 2016. According to the authors of the draft law, the abolition of the end date of the moratorium “will renew the legal basis for the search of new ways of restructuring the external debt.”

According to representatives of  the Opposition Bloc, adoption of this law means Ukraine’s default. “This is a unilateral refusal to fulfill the obligations on foreign loans. Voting for this law is the recognition of default,” deputy Alexander Dolzhenkov said.

According to another deputy of the Opposition Bloc, Mikhail Papiev, the end date of the moratorium on the payment of foreign debt should be mandatory in the legislation of Ukraine.

Earlier, Prime Minister of Ukraine Arseniy Yatsenyuk said that Ukraine would be able to pay $30 bln of external debt over four years, including the $3 bln debt to Moscow. On December 18, 2015, the government of Ukraine introduced the moratorium on the payment of Russian debt.


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