S&P cuts Ukraine outlook over IMF loan

The international credit agency said that the negative outlook means the eastern European country could lose its B plus rating in coming months.

“Uncertainty about the Ukraine government’s negotiations with the IMF and (Russian energy giant) Gazprom is increasing refinancing risks,” Standard Poor’s said.

According to the Ukrainian officials Kiev is seeking to restructure a USD 3 billion loan from the International Monetary Fund, a Press TV correspondent reported on Saturday.

However, all the previous attempts to resume the cooperation with IMF failed. The Ukrainian government rejects the creditor’s request of raising the gas prices for households in order to balance the State budget.

Ukrainian President Viktor Yanukovych is meanwhile hoping to get a discount on supplies of Russian natural gas and avoid raising prices ahead of parliamentary elections this fall.

Ukrainian government has already drawn a USD 2 bln loan from Russia’s VTB-bank to finance its fiscal deficit. Analysts however say that exceeding this debt can make the country fully dependent on Russia.

Failure to restructure the IMF loan and other debts that mature this year will put pressure on the country’s national currency, hryvna.

PG/JR

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