Page 12 - UKRRptJun19

passports, it won’t change anything. For being Ukrainian is not a line in the passport - being Ukrainian is here [in the heart]."
On April 24, Putin has signed an order simplifying the procedure for obtaining a Russian passport for residents of the rebel-controlled Donetsk and Luhansk regions of eastern Ukraine.
Earlier, Zelenskiy declared his readiness to grant citizenship of Ukraine to Russians who suffer from an authoritarian regime. "We will provide Ukrainian citizenship to representatives of all peoples who suffer from authoritarian and corrupt regimes. First of all, to Russians, who today suffer almost more than everyone," he said at the time.
2.1 Clearstream to link Ukraine to global financial system
Ukraine’s capital markets will be hooked up to the global financial system on May 27, when it joins the Clearstream international payments and settlements system, the Ministry of Finance said in a press release on May 22.
The long anticipated development could mean a revolution for Ukraine’s capital markets as bond traders in the international financial capital of the world will be able to buy a selection of local and government bonds direct from their own dealing desks without the need for a Ukrainian-based intermediately.
As bne IntelliNews has been reporting interest in Ukraine’s high yielding local debt has taken off this year in anticipation for the change. Foreign investors have already invested over a $1bn into the local market debt and now account for 5% of the bonds outstanding, up from nothing two years ago.
Ukraine is one of four countries that also includes Georgia, Belarus and Armenia, that signed up for the “Clearstream-lite” deal where a limited number of securities are included on the platform. The local markets of these countries are too small to make it worth extending the platform to cover all the securities on offer, but the local debt markets are big and liquid enough to interest international investors looking for short-term high yielding bonds and that have a large risk appetite.
Clearstream is the international central securities depository (ICSD) of Deutsche Börse Group and will connect the Ukrainian market to its network to make Ukrainian government securities eligible in its system. Citi will act as cash correspondent bank and local operator of Clearstream’s account at the National Bank of Ukraine (NBU), MinFin said in its press release.
“This step will enable settlement of all government bonds denominated in the local currency hryvnia through the international system of Clearstream, improving efficiency at international standards while reducing costs for investors,” the statement says.
Russia already put this reform into place in 2012 and saw the share of foreign investors in its local bonds explode. Today non-resident investors account for a bit less than a third of all bonds outstanding and the reform brought billions of dollars into the market. Ukraine is hoping to repeat the experience.
“This joint initiative should encourage an increase in demand for Ukrainian
12 UKRAINE Country Report June 2019 www.intellinews.com