Ukraine Asks Creditors to Write Off Its $57 Billion Debt
© Sputnik / Alexandr DemyanchukUS and Ukrainian notes and coins
© Sputnik / Alexandr Demyanchuk/
Starting off in 1992 with a foreign debt of $0 thanks to Russia’s commitment to take on the Soviet Union’s $100 billion in liabilities, successive Ukrainian governments have piled up tens of billions-worth of dollars in obligations to foreign creditors, including the International Monetary Fund, the United States and the European Union.
International creditors should write off Ukraine’s foreign debt in light of the Russian military operation in the country, Accounts Chamber of Ukraine chief Valeriy Patskan has suggested.
“The scale of the destruction in Ukraine caused by Russian aggression is colossal! In view of this, our external creditors must be required to write off Ukraine’s debts. To date, the external debt is 1.6 trillion hryvnia, or more than $57 billion,” Patskan wrote in a post on his Facebook page on Tuesday.
“International financial organizations should revise the debt policy and zero out the debts of Ukraine!” he urged.
Ukraine’s debts to foreign creditors have grown steadily under each of its successive governments, with former president Leonid Kuchma the only one of the country’s six post-independence presidents to take measures to try to reduce the debt burden between the early and mid-2000s.
Ukraine became a member of the International Monetary Fund in 1992, with the creditor providing the country with tens of billions in conditional loans which required the country to make economic reforms aimed at opening the country to foreign, predominantly Western, markets. These reforms, combined large-scale corruption and a variety of social ills, turned the country from one of the most advanced industrial economies in the world into one of the poorest countries in Europe in the space of 30 years.
Kiev currently owes the IMF over $5 billion, with another $2.3 billion owed to the International Bank of Reconstruction of Development, and billions more to the United States, the European Union, Canada, Germany and Japan. About three quarters of the country’s debts are denominated in US dollars, with the dollar-hryvnia exchange rate hitting a historic all-time low in recent trading owing to the ongoing conflict.
31 March 2020, 03:10 GMT
Russia launched a military operation in Ukraine on Thursday aimed at demilitarizing the country after a request for assistance from its Donetsk and Lugansk People’s Republic allies after weeks of shelling, sniper and sabotage attacks by Kiev forces in the Donbass, and months of escalating tensions between Moscow and Kiev’s Western sponsors. The conflict is the culmination of a crisis which began in February 2014, when Ukraine’s neutrality-seeking government was overthrown in an unconstitutional coup d’etat and replaced by political forces seeking to pull Ukraine into the European Union and NATO.