REUTERS
Writing-off of Ukrainian public debt and reducing interest payments will delay Ukraine's return to the capital markets, the creditors' committee overseeing talks on restructuring Ukraine’s state debt has warned.
Ukraine's intention to write off part of the public debt and lower interest rates, thus reducing interest payments as part of proposals on restructuring, will increase its dependence on institutional lenders, a letter from the committee of Ukraine's private creditors reads.
"The criteria for debt restructuring proposed by the IMF are viewed by Ukraine as writing-off [the national debt], lowering interest payments and extending payments. Such an approach will delay the entry of Ukraine to the capital markets, increase the cost of borrowing and increase the country's dependence on official financing [from institutional lenders],” the creditors’ letter reads.
“In this context, debt relief will not contribute to the economic stabilization of Ukraine and opportunities for economic growth."