Ukraine cancels USD 500 mln Eurobond issue
14 July 2008
The Ukrainian government will not issue USD 500 mln in Eurobonds as it planned, Prime Minister Yulia Tymoshenko said at a press conference on Saturday. According to Tymoshenko, the reason is the Verkhovna Rada failed on Friday to approve amendments to the 2008 state budget that would have increased budget expenditures by UAH 24.0 bln (USD 4.9 bln) (see related news). Tymoshenko said that currently the Cabinet of Ministers’ treasury funds (UAH 32 bln (USD 6.6 bln)) would be sufficient to maintain a budget surplus. In June, the Cabinet of Ministers started a roadshow for the Eurobond issue, which was rated BB- by Fitch. Oleksandr Klymchuk: Misled by one rating agencies, the market went too far in exaggerating Ukrainian risk: the sovereign spread widened to 440 bps. The government is not in need of the money now and will wait until it can be borrowed at a more reasonable cost.
