The Verkhovna Rada Budget Committee proposes the option of suspending foreign debt payments
18 July 2024 11:21
The Budget Committee of the Verkhovna Rada of Ukraine has recommended the adoption of the government’s draft law No. 11396 on public debt restructuring. This was announced by the chairman of the committee Roksolana Pidlasa, reports "Komersant Ukrainian"
According to the MP, the draft law contains two key provisions. The first one allows the government to include the state-guaranteed debt of the former Ukravtodor in the amount of public debt and restructure it. This refers to the 2021 Eurobonds worth $700 million plus interest.
The second provision gives the government the right to temporarily suspend payments on external public debt if necessary. This could happen if a formal agreement on restructuring is not reached by 10 August.
Pidlasa noted that a similar decision had already been applied in Ukraine in 2015. According to her, the IMF supports this draft law, as it will help strengthen Ukraine’s debt sustainability.
“We will ask the Verkhovna Rada to support this draft law at the next plenary session,”
– pidlasa said. She added that the restructuring would save more than USD 10 billion in sovereign Eurobond servicing and repayment payments by the end of 2027.
The committee also limited the right of the Cabinet of Ministers to suspend payments on external public debt until 1 October 2024.
Meanwhile, the hryvnia is breaking through a historic low, but the NBU is ready to “take action“.
