KYIV, Jan 6 – Ukraine is facing $11 billion in debt payments in the next six months that may delay the country’s economic recovery after the coronavirus pandemic, the Finance Ministry said in a new forecast.
The forecast increased Ukraine’s debt payments by 23.6% to $11 billion compared with $8.9 billion seen 30 days ago, reflecting the government’s massive short-term borrowing in December 2020.
The payments include both, foreign and domestic debts, and come as the government has failed to resume cooperation with the International Monetary Fund due to delayed reforms.
Ukraine borrowed $340.7 million for 6 months from Deutsche Bank AG in December weeks after raising $600 million from an issue of eurobonds that will mature in 2033. The government also raised at least UAH 75 billion ($2.7 billion) from selling short-term treasury bills in December.
The IMF suspended lending to Ukraine in July amid concerns the government has postponed economic reforms and inefficient measures to fight corruption, withholding about $1.4 billion in loans in the second half of 2020.
Prime Minister Denys Shmyhal said the IMF may resume lending to Ukraine in February or March if the government can prove that it had restarted economic reforms and made progress in battling corruption.
In the new forecast, the Finance Ministry said Ukraine will have to pay UAH 138.85 billion in debts in the first quarter, up UAH 28 billion from a forecast 30 days ago.
In the second quarter, Ukraine will have to pay UAH 165.67 billion, up UAH 29.12 billion, while in the third quarter Ukraine is due to pay UAH 162.43 billion, followed by UAH 118.1 billion in the fourth quarter.
“The peak periods of public debt payments in 2021 are forecast in the second and the third quarters,” the Finance Ministry said.
Overall, Ukraine's external borrowings in 2020 amounted UAH 232.3 billion, or 92.4% of the plan, and domestic borrowing was at UAH 389.2 billion, or 94.6% of the plan, according to the Finance Ministry. (tl/ez)