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Putin: Russia cares little how Ukraine used its loan, it is interested in repayment

June 16, 2015, 21:05 UTC+3
The Ukrainian government will consider the possibility of declaring a freeze on foreign debt payments if its talks with creditors on rescheduling debts end in failure
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© Mikhail Klimentyev/TASS

NOVO-OGARYOVO, June 16. /TASS/. Russia cares little about how Ukraine used its loan but is interested in its repayment, Russian President Vladimir Putin said on Tuesday.

"We care little who and how used this money. We want to have it back," he said at a news conference after his talks with visiting Finnish President Sauli Niinisto.

He said Russia had issued its loan to Ukraine to ensure a balanced budget and to solve social problems. He reminded that after Ukraine’s aggregate debt had exceeded 60% of its GDP Russia could have demanded early payment of the debt.

"We are not doing this bearing in mind the difficult economic situation [in Ukraine]," Putin underscored. "But we hope to have this money back as is committed to paper in the relevant agreement."

Ukraine's Finance Minister Natalie Jaresko earlier said the government will consider the possibility of declaring a freeze on foreign debt payments if its talks with creditors on rescheduling debts end in failure. 

Jaresko argues that the "possibility of a freeze on debt payments is not a terrible thing." 

"It will by no means stop the IMF program. There will be no big pressure either on the Ukrainian population or on the Ukrainian banking system," Jaresko said.

A moratorium would apply to external bonds beyond the bounds of Ukrainian banks.

 Ukraine passed a law granting the government the right to impose moratorium on foreign debts payments, including the $3 bln debt received from Russia in 2013. Prime Minister Arseniy Yatsenyuk earlier said Ukraine was to pay $30 bln of foreign debt and $17 bln of domestic debt within 4 years. He added that the moratorium concerns only private creditors, holding the debt of Ukraine. He also called on the country's Western partners to grant it real financial assistance.

Kiev regards its $3 bln Eurobonds held by Russia as a private loan, which is thus subject to the moratorium. Moscow insists the loan cannot be considered private and should be paid back in due time - in December 2015.

 
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