Page 41 - UKRRptJun22

$30bn in FX reserves. Market external debt due to year end was pretty light at a few billion bucks. But the war has decimated public finances and estimates are that Ukraine has a budget financing shortfall of close to $5bn a month. Now so far it has received around $11bn in Western financing and this week got another promise from Western allies of close to $17bn in additional financial support. This should see it through to the fall, at least, if fighting continues. But unfortunately most of this Western support has come in the form of loans - sad that the West is only lending Ukraine the money to fight this war which is really providing a bulwark for the West against Russian aggression. But assuming that remains the case, and if the war continues to year end, with a possible 30-40% real GDP contraction, Ukraine’s debt/GDP ratio could well then be over 100%.
Ukraine's foreign debt should be restructured. Former Chairwoman of the National Bank of Ukraine Valeriia Hontareva believes that Ukraine's external debt should be restructured by postponing payments for five to ten years, reported NV.ua. “Now, it is also important for us to reach out to investors who understand and support us well and ask to postpone our payments for five to ten years just to relieve us of the budget burden." Hontareva. She added, "In my opinion, it is ethically wrong to take money from some investors and pay others, especially since others are ready to help us restructure our debts and understand our situation." However, according to current Finance Minister Serhiy Marchenko, writing off and restructuring public debt is not necessary at the moment. There are no problems with its maintenance. The IMF predicts an increase in Ukraine's public debt this year to 86.2% of GDP due to the consequences of the war with Russia
41 UKRAINE Country Report XXXX 2018 www.intellinews.com