Russia takes Ukraine to court over $3bn Eurobond

By bne IntelliNews February 17, 2016

Russia's Finance Ministry has filed a lawsuit against Ukraine in the High Court in London over the repayment of a $3bn Eurobond due in December 2015, plus associated costs, RIA Novosti quoted minister Anton Siluanov as saying on February 17.

The move shows that Moscow will now close all room for talks over the debt and ratchet up its argument internationally that Kyiv failed to negotiate "in good faith" with its creditors, as it must do under its ongoing bail-out programme with the International Monetary Fund (IMF) - a point that Siluanov also noted again.

The minister stressed that Kyiv had proved itself unfit to hold constructive dialogue on debt restructuring, while reiterating that the Eurobond issue should be recognised as official sovereign debt and settled on terms better than those Ukraine proposed to its private creditors.

Germany had also previously asked Ukraine to revise the terms of its offer to restructure the $3bn Eurobond, bought by Russia in 2013 from the Ukrainian government that was toppled by protests in 2014, Bloomberg reported earlier, quoting an unnamed source close to the talks.

In December, the IMF's executive board announced it will change its lending policies to allow it to keep supporting countries that fail to repay official debts. This provided an opportunity to continue supporting Ukraine if the country failed to repay the Eurobond to Russia.

Previously, IMF policy did not allow it to lend to countries that are in arrears to other governments.

Related Articles

Euroclear warns EU on using Russian assets for Ukraine loans

Euroclear has cautioned EU officials about potential risks linked to plans to use frozen Russian assets as collateral for loans to Ukraine, reported Ukraine Business News. ... more

Ukraine faces a difficult choice over US peace deal talks: lose its dignity or lose a partner

Ukrainian President Volodymyr Zelenskiy recorded a video address to the nation saying Kyiv faces a difficult choice: the country could lose its dignity by accepting the plan, or it could refuse and ... more

Turkish LPG carrier set on fire during Russian drone attack

A Turkish LPG carrier docked at the port of Izmail, Ukraine, was hit by a Russian drone during an attack, sparking a fire on the vessel, which has now been extinguished. According to the Maritime ... more

Dismiss