Ukraine’s total external debt hits 84.5% of GDP in 3Q10

Ukraine’s total external debt reached USD 111.6 bln as of end-3Q10 or 84.5% of GDP 2010F, increasing 6.7% q-o-q (8% YTD). The major bulk of debt accumulation came through the public sector (+21.8% q-o-q), including the USD 2.5 bln Eurobond placement in September. Mykyta Mykhaylychenko: By end-2010, total external debt could be as much as USD 114 bln or 86.3% of GDP 2010F (down from 88.1% as of end-2009). Short-term (ST) external debt (with maturity within the next 12M) amounted to USD 43.7 bln as of end-3Q10 (-1.8% q-o-q). Central bank reserves of USD 33.5 bln as of end-November imply ST debt coverage of 76.6% (vs. 67% as of end-2009). Half of this year’s increase in ST debt came from a USD 2 bln loan from VTB originally provided for 6M with the possibility of three 6M prolongations (the government already prolonged the loan once in December and we expect it to do so twice more in June and December 2011).