The Ministry of Finance of Ukraine commented on the default of Ukrzaliznytsia
The announcement by the State Administration of Railway Transport of Ukraine (“Ukrzaliznytsia”) of default on its internal debt obligations indicates the seriousness of the situation in the company.
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This is stated in a statement by the Ministry of Finance of Ukraine.
The Ministry of Finance noted that the current technical default will not affect the obligations of Ukrzaliznytsia to the state banks Ukreximbank and Oschadbank.
“It is important to note that Ukrzaliznytsia defaulted on its domestic debt, which is not part of the debt transaction agreed upon under the IMF program. At the same time, this default demonstrates the macroeconomic challenges facing Ukraine and the need to successfully reach an agreement on the debt transaction, which is also consistent with Ukraine's agreements with the IMF.
“The restructuring is a condition of the IMF Extended Fund Facility (EFF) program and is aimed at ensuring the sustainability of Ukrainian debt in the medium term,” the Ministry of Finance said in a statement.
Let us remind you that today Ukrzaliznytsia announced its technical default to its creditors.
Let us also recall that the main condition that the IMF set for Ukraine for further lending is that Kiev obtains the consent of creditors to write off the country’s previous debts. Ukraine must reach an agreement with creditors by June of this year. If negotiations with creditors are unsuccessful, the IMF will stop lending to Ukraine, after which, according to experts, the country will face a default within one to two months.
The Ukrainian Ministry of Finance commented on the default of Ukrzaliznytsia.