As Ukraine faces the end of a two-year moratorium on repaying $20 billion in government bonds amidst a war with Russia, the world’s largest asset managers, including BlackRock and Pimco, are demanding repayment. Initial negotiations between creditors and Kyiv failed to reach an agreement, with Kyiv offering a 60% discount on securities, while creditors only willing to agree to 20%. The restructuring is crucial for Ukraine, which spends $40 billion annually on defense, and needs $37 billion to complete its 2024 budget.
IMF demands reforms
The International Monetary Fund has made debt restructuring a prerequisite for support, with demands for reforms in corruption, tax collection, and debt reduction. While G7 leaders have approved a $50 billion loan for Ukraine, the country must keep options open due to political uncertainties regarding future support from the EU and US.
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