WT: the Ukrainian Finance Ministry will turn the country into a financial pariah

The proposal of the Ukrainian authorities to write off public debt bondholders will only exacerbate the economic situation in the country, writes the American print Publication.

the magazine calls this idea of " short term thinking ", which is only stronger crippling the economy of the country.

General state dog of Ukraine is about 70 billion dollars, of which about 40 billion dollars accounts for external debt. Ukraine in the framework of the plan of debt repayment has asked creditors to write off 40% of the principal amount of the debt and accept a fresh bond linked to future economic performance. However, the dialogue on restructuring until failed. Kiev sent to creditors last edited Proposal, and did not exclude, if necessary, the imposition of a moratorium on the payment of foreign debts.

"If Ukraine will lay the rescue of debts to private creditors or even worse does not fulfill obligations, It in fact will become a financial pariah. She will lose access to capital markets, thereby depriving themselves of a substantial payment, " writes WT.

in the end, Ukraine will not be able to obtain the money necessary for the revival and reform of the economy, which in the long term ensures the preservation of the independence of the country, says the magazine.

By their actions the authorities will also put at risk the provision of financial assistance by the IMF, as proposed with the condition that Ukraine has about 7 billion dollars by 2020. However, in practice, when a country loses market access, we have a long way to restoring the confidence of investors, emphasizes WT.

The private sector of the economy will also suffer, continues the print Edition. Ukraine ought to attract a large number of creditors and reach an agreement that would satisfy investors, and not would scare them away.

review the author of the article, the Sentence " the talented Minister of Finance Natalia Jaresko is erroneous, because She has asked for the debt on the bonds from private investors, not other creditors. So, her plan would affect only 19 billion dollars of public debt from 70.

As stated by the magazine, private creditors oppose writing off 40% of the debt and offer to extend the maturity of all debts of Ukraine to 2019, explaining that by this time the economy will recover in order to begin to make payments. This idea could satisfy the IMF and to make Ukraine a welcome party markets, notes WT.


sections: Politics