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Ukraine will service debt on time and in full despite Russian invasion -government

Published 03/08/2022, 01:02 PM
Updated 03/08/2022, 01:08 PM
© Reuters. A view shows buildings damaged by recent shelling during Russia's invasion of Ukraine in Kharkiv, Ukraine, March 8, 2022. REUTERS/Oleksandr Lapshyn

By Natalia Zinets

LVIV (Reuters) - Ukraine will service its debt on time and in full, bolstered by financing from allies and international institutions who have rushed to Kyiv's aid since the Russian invasion, the finance ministry told Reuters on Tuesday.

"We continue honouring our debt even in these extraordinary conditions," the ministry said in a written comment.

Ukraine paid almost $698 million of its external obligations in the first two months of the year and faces a further $3.7 billion in March-December, including peaks of $499 million in May and $1.73 billion in September.

The ministry said Ukraine has access both to concessional and commercial financing. It has issued so-called "war bonds" on the domestic market after borrowing on the overseas market became expensive.

"We are working to maximize the funding from both sources to meet all the budget needs including debt repayments," it said.

Kyiv expects to receive 300 million euros from the European Union and $350 million from the World Bank this week. The U.S. government offered $1 billion of loan guarantees last month.

The International Monetary Fund said its board was expected to consider Ukraine's request for $1.4 billion in emergency financing in the coming days. Ukraine also has $2.2 billion available through June under an existing stand-by arrangement.

© Reuters. A view shows buildings damaged by recent shelling during Russia's invasion of Ukraine in Kharkiv, Ukraine, March 8, 2022. REUTERS/Oleksandr Lapshyn

"The IMF, the World bank, the G7 countries and other partner countries announced their financial support to Ukraine and some of it has already been disbursed," the ministry said.

Russia invaded Ukraine on Feb. 24, shelling cities and hitting Ukrainian military installations and causing more than 2 million people to flee.

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