Nuland: US urges Russia to write off part of the debt of Ukraine

WASHINGTON, 8 October. /Corr.TASS Dmitry Kirsanov/. The American administration is in favour of Russia wrote off part of the debt of Ukraine by adopting the same terms of repayment, which Kiev earlier offered its commercial creditors. It was confirmed on Thursday, the U.S. assistant Secretary of state for Europe and Eurasia Victoria Nuland.

See you in Peru?

Speaking at a hearing of the foreign Affairs Committee of the Senate of the U.S. Congress, Nuland said that, according to U.S. government reports, Kiev in the coming days intends to appeal to Moscow with a proposal to start consultations on the question of repayment of debt amounting to $3 billion, the same conditions that were recently adopted by commercial creditors of Ukraine.

“My understanding is that the Ukrainian government plans to appeal to the Russian government that the negotiations can commence in the coming days in the framework of (annual) meetings (of governing bodies of the world) Bank and the (International monetary) Fund in (the capital of Peru) Lima”, – said the employee of foreign policy Department of the USA.

According to her, if Russia “will actually take the same conditions” on which Kiev earlier agreed with commercial creditors, “it should be acceptable for Ukraine”. “Let’s see what Russia will do in these circumstances”, – said Nuland.

In this regard, Senator Robert Menendez (Democrat from new Jersey) asked her: “Is this proposal was already rejected once?” “Official negotiations on this matter was, as an agreement with private creditors was reached only a couple of weeks ago. Let’s see how Russia will act,” he replied to the diplomat.

Debt relief as economic assistance

This Nuland recalled that Russia first signaled its desire to promote the advancement of the economy of Ukraine, which is currently experiencing a deep recession, is able, according to the International monetary Fund and the world Bank, to minus 11-12% by the end of this year. “Russia said he wanted to help with the (economic) recovery. It would be one way to do so,” said Nuland. If Russia “will not accept these conditions, then we have to work with Ukraine on other options,” added the assistant Secretary of state, not decoding your statement.

However, what the United States plans to provide Ukraine with financial assistance Nuland did not mention. She just said that if Ukraine will continue implementing economic and political reforms, the US administration expects “at some stage this winter” to refer to the Congress with a request to approve a third time granting Kyiv credit guarantees on $1 billion Nuland did not specify exactly when the Executive branch of the U.S. government may apply to a legislative request. In any case, it is not about “live” money, and solely about the US commitment to pay Ukraine $1 billion, if Kiev will take this money and then not be able to repay it.

20% write-off and extension

On 27 August it was announced the agreement providing for the extension and 20% write off Ukrainian debt to private creditors. The Minister of Finance of Ukraine Natalie Jaresko has offered the same conditions and Russia, claiming that the full payment of Moscow loan of $3 billion “is not an option” for current authorities in Kiev. In response, her Russian counterpart Anton Siluanov said that Moscow will insist on the full repayment of the debt, considering it a sovereign.

In December 2013, the presidents of Russia and Ukraine Vladimir Putin and Victor Yanukovych have agreed that Moscow will give Kiev a loan of $15 billion through the placement of Ukrainian securities. Under this program, bonds for $3 billion were placed on the Irish stock exchange on 20 December 2013 and bought by Russia at the expense of the national welfare Fund.