Arseniy Yatsenyuk: We want to repay foreign debts, but on the terms offered by the Government and the Ukrainian state

The Verkhovna Rada has supported a Government bill "On peculiarities of transactions with the public, publicly guaranteed debt and the local debt" (No. 2898) and corresponding amendments to the Budget Code of Ukraine (No. 2899), which allows the Government to impose a moratorium on payments of foreign debt to private creditors.

While presenting the bills at a session of the Verkhovna Rada of Ukraine on Tuesday, May 19, Prime Minister of Ukraine Arseniy Yatsenyuk stressed that the Government in synergy with the Parliament "more than a month are engaged in activity to stabilize the finance of the Ukrainian state, to fill the budget, reduce the debt burden on the Ukrainian budget and give people an opportunity to feel what living standards are changing - that salary can grow, new jobs created, incomes of citizens indexed. And that life in Ukraine will just be better."

"For this purpose the Parliament, the Government and the coalition, together with the President of Ukraine, have made a number of steps for reforms in the country. And these steps are now assessed primarily by our foreign creditors," the Prime Minister stressed, recalling that following the recent Ukraine- European Union summit the EU official documents contained that "Ukraine is not just talking about reforms - Ukraine has implemented and Ukraine will continue to pursue these reforms."

Arseniy Yatsenyuk noted that Ukraine receives support from its international partners, however, “this support is insufficient unless we make right and strong decisions, not just to balance the budget, but to remove the debt burden from future generations".

"To prevent our children, our grandchildren paying the debts of Viktor Yanukovych is the task of this Parliament", emphasized the Head of Government.

In the framework of cooperation with the International Monetary Fund and other foreign creditors last year, Ukraine received a bailout package: "We obtained $ 9 billion loans from our western partners. But we paid back $ 14 billion of loans to our western partners. Is it fair for the country that is at war and under fire?"

"I consider the private creditors of the country should take real steps to help the Ukrainian people to overcome the Russian aggression, to settle the economic situation and become a real European state with a European lifestyle," said the Prime Minister.

He recalled that previous year, when he had been appointed Prime Minister of Ukraine, the country's debt amounted about $ 72 billion: "Throughout a year we have reduced the debt by 3 billion US dollars. That's good. But we cannot live following the formula: to take new loans in order to repay old ones. We should put an end to this formula".

“Overall current liabilities of the country approximately 70 billion US dollars. The number of external debts of the country, for example, as of 1 January 2008 was just 17,6 billion. Over three years Viktor Yanukovych and his gang managed to take 40 billion dollars that disappeared. People didn't see them. But the state budget felt the burden, and it became the burden for each Ukrainian citizen, each Ukrainian family. I want us to free Ukrainian people from debt load, the country is facing today accumulated by Yanukovych and his associates," emphasized Arseniy Yatsenyuk.

The Prime Minister highlighted that this year alone the total amount envisaged in the State Budget for external payments is equal to the sum envisaged for the entire national security and defense: "The sum worth 90 billion hryvnias we have to take from the budget and pay back to our foreign creditors for funds not borrowed by us".

The Ukrainian Government, according to him, began talks with the creditors to restructure the debt. He noted that the total amount of financial assistance from our external partners: International Monetary Fund, G7 countries and other contributors makes up $ 25 billion for four years: "At this, out of the sum worth 25 billion dollars we can use a maximum of 15 billion to repay our external debts. And the difference worth $ 10 billion to be spend to replenish foreign reserves, which, incidentally, grew up and now make it possible to maintain currency stability."

"So, we have for the next four years $ 15 billion as our financial asset," he explained.

On liabilities, the Head of the Government said that Ukraine has to pay $30 billion of the external debts and $17 billion U.S. of internal debts in four years: “We have 15, but we owe 47 billion. The question is: how to pay? We can't pay these debts from pockets of Ukrainians ".

Arseniy Yatsenyuk appealed to external creditors: "We ask our external private creditors to listen to the proposal of the Government of Ukraine and to restructure the debts of Ukraine, which are owned by private lenders, on the terms proposed by the Ukrainian Government. In the next four years we need to get a resource from this reorganisation, reduce the load on the Ukrainian state from external debts amounting of about 15 billion U.S. dollars."

In accordance with the passed lows the Cabinet of Ministers is entitled to set a moratorium for foreign payments on debt obligations to exclusively private creditors on the list of duties specified in the schedule to the law.

Arseniy Yatsenyuk stressed that such a right the Government can use in case of need – if we do not agree with our creditors." "And we hope that we will agree with our creditors," the Head of Government said.

"We want to pay, but we want to pay on the terms on which the Ukrainian Government and the Ukrainian state offers," Arseniy Yatsenyuk noted.

He stressed that laws mention solely private creditors, who are holders of the state external debt of Ukraine: "we are not talking about the state Ukrainian banks which pay their obligations."

"This debt operation that is conducted by the Government of Ukraine together with our creditors has no negative effect on either the Ukrainian banks or at currency exchange rate, but on the contrary it will be positive, because after the operation the debt of Ukraine will be smaller, and this means that the confidence of both lenders and investors will be more, because the Ukrainian economy will be more healthy," the Head of Government stressed.

He addressed to private lenders, "If you want to support Ukraine, if you rightly welcome Ukrainian citizens and the Ukrainian state, which is suffering from Russian aggression, suffering from war, lost 20% of the economy, lost through the Russian military aggression Crimea, where tens of thousands of Russian militaries trample Ukrainian land, help us not by word, but a dollar, or rather, billions of dollars".

"The Ukrainian people will appreciate it and it will be real answer and help for Ukraine, and Europe as a whole," A. Yatsenyuk said.

The PM appealed to the MPs of Ukraine to pass these bills: "let's help the Ukrainian people to save money, get a resource for the indexation of incomes. And let's release our children and our future generations from this burden created by Yanukovych and his predecessors."

The Verkhovna Rada supported the bill "On peculiarities of transactions with the state or guaranteed by the state debt and the local debt" (No. 2898) and corresponding amendments to the Budget Code of Ukraine (No. 2899). 256 and 246 MPs voted “For” respectively.

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