Ukraine’s Finance Ministry may cause default if it fails to pay Russia $3bn

Ukraine may face a default if it fails to repay its $3bn bond debt, Ukrainian Finance Minister Natalie Jaresko said in an interview to the Fifth Channel.

She said that Ukraine is not going to repay the debt as Russia has not joined the rescheduling program. “If we do it, we may face a default, but it is early yet to speak about what we will do and what they will do. We are preparing for any possible scenario,” Jaresko said.

She said that Ukraine is not able to repay the debt. “The IMF program clearly says how much we can allocate for what – from covering the budget gap to repaying debts,” Jaresko said.

As EADaily reported earlier, Russia lent the money in Dec 2013. In exchange Ukraine gave Eurobonds worth $3bn through the Irish Stock Exchange. Ukraine regards it as a commercial loan and has included it in the list of rescheduled loans. Russia is not going to reschedule the debt and insists that it be repaid by the end of Dec 2015.