REUTERS
The negotiations to restructure $23 billion of Ukraine’s debt appeared to reach a boiling point on Tuesday night, after Ukrainian Ministry of Finance made a harsh statement calling into question the transparency, efficiency and responsiveness of a creditors' committee, Ukrainian newspaper ZN.UA has reported on Wednesday, May 13, with reference to the Financial Times.
The talks between the Ukrainian government and international investors now seem to be in a deadlock, according to the FT.
The Finance Ministry said in a statement that it was "concerned about the approach taken by the creditors' committee representing the country's external debtholders and their lack of willingness to engage in negotiations." The tough words came amid growing market expectations that the restructuring negotiations are likely to stretch on all summer until Ukraine continues in the face of creditor disapproval to demand the haircut and maturity extensions to save up $15 billion in the next four years (as stipulated by Ukraine’s agreement with the IMF).
Earlier on Tuesday, a group of the country’s largest creditors declared that they were "ready and willing to support a prudent debt restructuring with Ukraine" but have had "no substantive engagement" from the government. In turn, Finance Minister Natalia Jaresko stated yesterday that last week she "offered to discuss the situation directly with a well-known committee member to facilitate and focus on negotiations, but was informed that he was “not available to talk to her."
The creditors' committee declined to comment on the statement of the Ministry of Finance of Ukraine.
As UNIAN reported earlier, Ukraine started negotiations on restructuring public debt worth of $23 billion on March 13 - immediately after the approval of a new lending program of the International Monetary Fund in amount of $17.5 billion.
One of the participants in the restructuring talks, a state-owned Ukreximbank, has released data according to which the Ukrainian side intends to save up to 5.2 billion dollars under debt securities in 2015 as the result of the negotiations.
The list of securities subject to restructuring includes also government bonds for $500 million, $644.220 million and $3 billion (purchased by the Russian Federation), municipal bonds issued by Kyiv city for $250 million, bonds issued by Ukreximbank worth $750 million, and loans of other government agencies worth a total of $225.54 million.
Negotiations with creditors are to be completed in May 2015, before the completion of the mission of the International Monetary Fund for the first review of the program.