Ukraine state debt dips 0.4% m/m in October

Ukraine’s state debt dipped 0.4% in October to USD 68.35 bln, the Finance Ministry reported on Dec. 1. Internal debt rose 0.5% while external debt declined 0.8%. Local debt increased in USD terms due to the hryvnia strengthening 1.6% to UAH 25.45/USD in November, on average. Local debt decreased in UAH terms since Ukrainian authorities borrowed money through state bond purchases worth UAH 4.7 bln (including EUR 141.3 mln) and paid back UAH 5.4 bln.

On external debt, nothing happened except for an SDR exchange rate variation. In October, the share of external debt decreased slightly to 67.4% from 67.6% in the prior month. 

Alexander Paraschiy: As expected, state debt remains almost flat amid no new external loans arriving. There could be some revival in December on the back of an anticipated EUR 600 mln macro-financial loan from the European Union and internal borrowings for the sake of deficit funding. However, this will not translate into a substantial rise in state debt, which we expect will reach USD 69.5 bln (78.1% of GDP) by the year end.