Ukraine granted more time to respond on Russia’s USD 3 bln debt claim

Russia agreed to give the Ukrainian Finance Ministry more time to respond to a Russian complaint in an English Court regarding the contested USD 3 bln debt, the Finace Ministry reported in its April 22 press release. Initially, the Russian side refused to give additional time for the response, asked by Ukraine, claiming that this should be decided only by the court, the release said. MinFin said it’s pleased that Russia “decided not to waste the court’s time in addressing an issue that Russia was obviously going to lose.”

Russian Finance Minister Anton Siluanov explained the same day that his side decided to grant more time given the political instability in Ukraine. He hopes Ukraine will use this time “to soberly evaluate the situation, revise the earlier declared position, and start good faith negotiations on debt repayment,” as cited by the Interfax news agency.

Recall, the Russian state fund, the holder of USD 3 bln in Ukrainian Eurobonds, was the only holdout in sovereign bonds restructuring that Ukraine completed in October. Ukraine failed to repay this Eurobond when it was due in December, claiming it cannot offer the holder any better restructuring conditions as compared to what the holders of USD 12 bln in other Eurobonds agreed upon.

Alexander Paraschiy: The tone of Ukraine’s and Russia’s interpretations of the same ordinary event suggests they are far from reaching consensus. This shows the conflict over the USD 3 bln debt issue won’t be resolved soon.