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Saturday, March 17, 2018

The chance to repay the loan to Kiev if Groysman increased

Russia will not support the IMF program for Kiev without repayment of debt to Russia to $ 3 billion, said Finance Minister Anton Siluanov. The national Bank of Ukraine expresses confidence in getting the next tranche from the Fund in the coming months. Experts disagree as to whether the consent of the IMF with the arguments of Moscow.

Moscow intends to insist on the inclusion of terms of repayment of debt to Russia to $ 3 billion in program assistance from the International monetary Fund (IMF), Ukraine on Tuesday said the Finance Minister Anton Siluanov.

“There are a number of issues, where Kiev is adequate need to be. Repayment of debt – just from this category”

“We as a sovereign creditor now in preparation of the new revised program, the IMF loans to Ukraine, we will defend the interests of inclusion in the program of the obligation of Ukraine to Russia, – said the Minister. – If this is not done, how can we support such a programme?”

Recall that the four-year program of financial assistance to Ukraine by the IMF provides, inter alia, the allocation of the country 17.5 billion dollars. In March 2015, was transferred the first tranche of the IMF loan, 5 billion dollars, in August – the second tranche of 1.7 billion dollars. Now Kyiv expects to release the third tranche, however, the transfer of funds the IMF has been postponed due to the political crisis in Ukraine, which prevented the adoption of necessary reforms. 10 may the IMF mission arrived in Ukraine and began work that needs to be completed on may 18.

“In the coming months”?

Almost simultaneously with the statement of the head of the Russian Ministry of Finance, Deputy head of the National Bank of Ukraine (NBU) Dmitry Sologub told that the country can receive tranche from the IMF in the coming months.

How the rising debts of Ukrainina last week, experts of international rating Agency Moody’s Investors Service in its report said that Ukraine may receive IMF tranche by the end of June. At the same time in the same report the Agency’s experts predict that the ratio of debt to its GDP will remain above 80%, and the question of payment of Ukraine’s debt in 3 billion dollars Russia will probably entail a lengthy court case in the international court.

We will remind, the Ukrainian side insisted that Russia took the same terms as trade creditors (who agreed to a debt restructuring). Kiev is motivated by the desire to put the alleged creditors in equal conditions.

However, the same IMF in December 2015, has officially confirmed that the debt of Ukraine to Russia is a sovereign, not commercial, in other words, has a fundamentally different status. While Ukraine has long denied it.

According to the IMF rules, the recognition of sovereign debt means that it cannot be restructured on the same terms as the debt to private creditors – the restructuring of sovereign debt should be by default better. Kiev said that taking into account the position of the Fund, however, will still not be able to pay the debt without violating the primary conditions of the loan.

4 may the President of Ukraine Petro Poroshenko has signed the Verkhovna Rada adopted the law that makes perpetual the temporary moratorium on the repayment of the Eurobonds loan, granted to Ukraine by Russia in December 2013 (in Ukrainian politics and the media referred to as the three billionth loan “bonds of Viktor Yanukovych” and is associated solely with the deposed President).

“The IMF wants to understand what will happen to these three billion”

The international monetary Fund is “likely to agree” with the requirement of Moscow to include the terms of repayment of the Ukrainian debt in the assistance programme of the IMF, suggests the General Director of the Ukrainian analytical center Alexander Okhrimenko.

In conversation with the newspaper VIEW Okhrimenko noted that even in the leadership of the IMF has expressed the desire to understand what will happen to this debt, as its restructuring. The IMF’s important to know how this problem will be solved, whether it go about the restructuring and some write-off, to understand how these three billion to be considered from the point of view of the debt. “The IMF does not put any stringent conditions that must be so and so, but he wants to understand what these three billions will be. They want to see the big picture. Because the amount is quite large. And without understanding for the IMF to develop a common program is very difficult,” the expert concluded.

“It is clear that the international monetary Fund will not pay. But it can be included in the program as one of the requirements of the IMF to Ukraine that Ukraine at least sat at the negotiating table have developed some kind of common model and thereby restructured this debt,” – said the source.

The Director of analytical Department of group of companies “Alpari” Alexander Razuvaev, in contrast to the Ukrainian colleagues, believes that the IMF will ignore the arguments of the Russian side. In his opinion, the Fund’s leadership is likely to declare that the credit Yanukovych was politically motivated, the expert said in comments the newspaper VIEW.

It would be nice if the IMF had included the requirement of Russia to the program. “However, given that we have a conflict not with Kiev, and the US – they are the main shareholder of IMF, I don’t think we have something shines”, – concluded the expert.

“There are no acceptable proposals”

As for the dialogue between the Finance ministries of Russia and Ukraine, the new Cabinet of Ministers of Ukraine has not yet formed, says the Russian Finance Minister Siluanov.

“(A dialogue develops) still does. We had no dialogue at the level of Finance Ministers. Unfortunately, it does not exist. Despite the fact that we as lenders do offer terms of restructuring the three billionth debt of Ukraine. Ukraine they did not react. From the Ukraine we have not received any acceptable proposals. There were technical talks, which were proposed terms of restructuring are worse than for commercial lenders. It’s absurd,” said the Minister in interview to TV channel “Russia 24”.

Groisman inclined to seek compromises

Director of the Kiev Center of political researches and conflictology Mikhail Pogrebinsky, evaluating the behavior of a new leadership of the Cabinet of Ministers of Ukraine, says: there is a chance that Prime Minister Vladimir Groisman will be looking for some of option agreements.

The expert noted in comments the newspaper VIEW that the new head of the Cabinet “there are no such units, which were its predecessor Arseniy Yatsenyuk, say, worse than we have with Russia, the stronger my political position”. “Besides, by nature he is inclined and interested to find some compromises, he said. – Therefore, it is beneficial to find an option to restructure the debt, which would be adopted by the Russian Federation”.

Pogrebinsky added that it is difficult to say how will work to realize these chances. “He did not himself make decisions. There is a political component related to the position of President, the state Department, which is also probably involved in the development of positions on this issue”, – concluded the expert.

The question is, where do not need to be adequate

Another opinion analyst, Director of the national energy security Fund (NESF), head of the political science Department Konstantin Simonov. “On the one hand, there are some more positive signs from the new government. At least, some things it makes it less idiotic,” said the source.

The source added that “the situation in the economy is rotten, Europe refuses to help. It will gradually sober up, and in some areas the dialogue with the new Cabinet will be more reasonable.”

“However, there are a number of issues, where they adequate to be not necessary, and the question of debt just from this Opera,” said the source. Simonov believes that it is not necessary to exaggerate the pragmatism of the new Cabinet as pay Ukraine does not want anything and, therefore, “may continue to behave inappropriately”. “She feels support and other creditors, who also do not mind to “throw” Russia”, – said the analyst.

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