Kiev — After a court decision in London Ukraine has practically lost chances to win the case of the loan granted by Russia to Kiev under Yanukovych. But Moscow soon will return their money, experts say.
Taken Wednesday, March 29, the decision of the High court of London obliges the Ukrainian side to immediately begin repayment three billionth loan Russia called Kiev “the duty of Yanukovych.” Nevertheless, the court in fact came to the conclusion that Ukraine does not have arguments not to. However, the script and the time of payment, may be different, I guess DW interviewed Ukrainian experts.
Hope for an appeal
London’s high court on March 29, granted the petition of Russia on the nature of the lawsuit to the Ukraine on the payment of Kiev loan of $3 billion in bonds purchased by Moscow in December 2013. The case should be examined in a simplified procedure, without a trial on the merits, which could take several years. The parties will confine myself to statements about their positions and the judge will deliver a verdict on the basis of research of documents.
Ukraine does not agree with the decision of the High court of London and is going to appeal. Investment banker at Dragon Capital Sergey Fursa in an interview with Ukrainian television said that the appeal could last up to a year and a half. In contrast, the Executive Director of the Bleyzer Foundation Oleh Ustenko has not excluded that process will take a few days. And in case if the payment of the debt will be deferred, Kiev will still have to pay every day from 700 to 500 thousand dollars for debt service of Russia.
Experts agree that Ukraine, of course, lost the case in the High court of London, which did not take into account the arguments of the Kiev political nature — the war in Donbass and the annexation of Crimea by Moscow. “Preparing and defending the appeal should involve professional experts, who will find arguments to the court listened to the arguments of the Ukrainian”, — said in an interview with DW Director of economic programs of the Kiev Center Razumkov Basil yurchishin.
All might end in default
In his opinion, the Ukrainian government would be extremely difficult to find funds for immediate payment of the three billionth debt. But the biggest problem, according to Yurchishin, is a even financial, and the social-political side. The payment of the debt of Russia, which in Kiev called “aggressor country” will not, he believes, adopted by the Ukrainian society, and there’s no word about the default and banishment from external financial markets if the loan is not repaid.
Experts do not exclude that the case will end with the announcement by Kiev’s partial default in the payment of the loan — all other debts are going to be given. But such a step could lead to the cessation of further external financing of Ukraine, warn them. “Ukraine is now simply there is no money to pay these three billion. In addition, under the terms of the extended Fund IMF Kiev simply cannot allocate funds for such payments,” — said Oleg Ustenko.
Not the last thing
According to Ustenko, the total external debt of Ukraine now stands at 81% of GDP, interest payment on these loans is 5.5% of GDP. “But the IMF acknowledged a “debt of Yanukovych” a sovereign, not commercial debt of Ukraine. Commercial debt now stands at $ 15 billion, and he restructured (principal payments begin in 2019. — approx. ed.). Therefore, we can say that, starting the program of the eff, the IMF saved Ukraine,” — said the expert.
After losing the case at the High court in London, Ukraine has not yet lost all the debt war with Russia, says Ustenko. “In the Stockholm arbitration and other international courts now consider a number of claims of Ukraine to Russia. Many of them have a good chance of success, and it means that prospects will be opened to recoup losses from the debt that he took from Moscow Yanukovych regime, — said Ustenko.