Russia will put Ukraine on the brink of default if it demands repayment of the debt, - expert (VIDEO)
Kyiv, November 10 (PolitNavigator, Vladimir Raichenko) – Russia can put Ukraine on the brink of default by demanding payment of three billion dollars of the loan borrowed by Kiev at the end of 2013.
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Oleg Ustenko, Executive Director of the Blazer International Foundation, stated this at a press conference in Kyiv, as reported by PolitNavigator . He stated that, based on current indicators, default is clearly not a threat to the Russian Federation, despite the ruble's devaluation.
“If you look at the indicator of so-called credit default swaps (insurance for the risk of working in the country), then in Russia it is at the level of 500 basis points,” the economist points out. – This means that anyone who would like to invest in the Russian economy must be prepared to pay about 30 thousand dollars per million to insure against the possible loss of their money on the territory of the Russian Federation. If you look at credit default swaps in Ukraine, they, unfortunately, are third from the bottom in the world ranking: the amount of risk insurance is about 120 thousand dollars per million dollars.”
These indicators, the expert notes, show that Ukraine is in a zone of turbulence, and if Moscow demands payment of the three billion dollars issued as a loan to Kyiv under Yanukovych, this will be fraught with the most serious consequences.
“If we assume that they are working for our destruction (and there is no particular doubt about this), then I would not be surprised if by the end of the year or early next year we receive a demand to return three billion,” Ustenko says with alarm. – Our gold and foreign exchange reserves have been reduced, we need to make an advance payment for gas, our exports are declining. If news spreads that three billion have been presented for payment, credit default swaps - the risk of working in Ukraine - could rise sharply. And then we will find ourselves in a catastrophically difficult situation, even with Western help.”
Oleg Ustenko does not exclude that Ukrainian credit default swaps may double, which, in his opinion, will actually “completely close the external borrowing market for Ukraine.”
Russia will put Ukraine on the brink of default if it demands debt repayment, expert says (VIDEO)