Ukraine public debt nears 95% of GDP by the end of March

Ukraine’s public debt was reported at UAH 1.5 trln as of end-March, in UAH terms, which is a 5.5% decrease m/m, according to MinFin data released on April 27. Its internal and external debt (in UAH terms) shrunk 5.7% and 5.5% throughout the month, respectively.

If calculated in USD, the public debt increased 11.9% m/m to USD 65.0 bln, with external debt increased 12.0% m/m (USD 4.6 bln) due to IMF support. Internal debt grew 11.7% m/m (USD 2.4 bln) due to hryvnia strengthening (to UAH 23.44/USD as of end-March vs. UAH 27.76/USD as of end-February). The share of external debt by the end of March was flat m/m at 65.5%.

Alexander Paraschiy: We estimate that the public debt has already reached 95% of GDP. We expect that the nominal value of public debt will be growing throughout the year. This is due in part to quasi-fiscal spending (Naftogaz support, banks refunding, and financing the Deposit Guarantee Fund). Also adding to the public debt will be external borrowings from the IMF, World Bank, EU, and Eurobonds placements, which are expected to be near USD 11.3 bln in April-December 2015. In light of this we see public debt approaching USD 80.0 bln, or 99% of GDP by the end of the year. The estimate accounts for the potential effect caused by an expcted extension of public debt maturing in 2015.