Representatives of Ukraine were unable to reach an agreement on the restructuring of state debt, as reported by international media and a statement from the Ukrainian government on the Euronext exchange website on April 24.
This is reported by Finway
According to information, Ukrainian representatives held a meeting with certain members of a committee composed of institutional holders of securities linked to Ukraine’s GDP (warrants), with a total amount exceeding 3.23 billion dollars. The holders of these securities stated that they could not accept the proposal received from Ukraine and put forward a counterproposal.
“Ukraine noted that it cannot accept the proposal from the limited holders and refused further proposals to the limited holders until the end of the Limited Period. Ukraine intends to continue engaging with the warrant holders and consider all available options,” the statement said.
According to the Financial Times, in May, Kyiv is required to pay 600 million dollars on its debt obligations or declare a default. Finance Minister Serhiy Marchenko commented on the situation, stating that Ukraine has suffered unprecedented losses due to Russian aggression.
“Economic losses are already estimated in the hundreds of billions of euros, and infrastructure across the country has suffered significant destruction. According to World Bank estimates, recovery costs could exceed 500 billion euros over the next decade. Financial stability and debt sustainability are critical for the full recovery and rebuilding of Ukraine,” he said.
Marchenko added that GDP warrants were created “for an economic reality that no longer exists” and should not hinder Ukraine’s recovery. He emphasized the need to find a fair and comprehensive solution to this issue.
The minister clarified that the meeting, which took place from April 15 to 23, was held with members of the Special Committee, which includes holders of about 30% of Ukraine’s GDP warrants. Ukraine proposed an exchange of warrants for new eurobonds to be issued as part of the 2024 restructuring or a change in the terms of the GDP warrants issuance. In return, the Special Committee proposed that Ukraine pay 75% of the payment due in May and issue new bonds at a rate of 7.75% for an amount of 209 million dollars maturing in February 2029. However, Ukraine rejected this proposal.
“Ukraine remains committed to conducting constructive negotiations with all GDP warrant holders in order to find a solution that ensures long-term debt sustainability without posing a threat to the country’s rebuilding and recovery,” Marchenko concluded.
The Executive Board of the International Monetary Fund completed the seventh review of the Extended Fund Facility for Ukraine on March 28. This decision allowed Ukraine to attract 0.4 billion US dollars, which will be directed to budget support. The total amount of payments under the IMF program will reach 10.1 billion dollars.