Ukraine state debt increases 1.3% m/m in April

Ukraine’s state and state-guaranteed debt increased 1.3%
m/m to USD 79.8 bln in April, the Finance Ministry reported on May 27. Internal
debt increased 4.1% m/m to USD 29.6 bln. External debt dipped 0.2% m/m to USD
50.2 bln.

In UAH terms, overall state debt decreased 1.0% m/m in
April.

Evgeniya Akhtyrko: Local
bonds, coupled with the hryvnia strengthening during the month, were the main
drivers for the state debt increase in US dollars. In April, MinFin attracted
UAH 33.9 bln, USD 416.6 mln and EUR 2.6 mln. For repayments, UAH 34.8 bln was
scheduled, including USD 693.2 mln in local Eurobonds.

External debt remained almost unchanged in U.S. dollars
but dropped 2.5% m/m in UAH terms in line with the hryvnia strengthening 2.6%
in April.

New external loans from IFIs are an option for the new
government to emerge after early parliamentary elections in July. We remain
optimistic and anticipate IMF cooperation will continue.

We project state and state-guaranteed debt will
increase to USD 80.8 bln in 2019, or around 62% of GDP (vs. USD 70.3 bln, or
60.9% of GDP in 2018).