Kiev--As government troops face off against pro-Russian separatists, Ukraine is also manoeuvring on the financial front, scrambling to stave off disaster by renegotiating its foreign debts.
Kiev's pro-Western government owes billions of dollars to US and London-based investors, among others, as well as Russia, its rival in the current conflict that has pushed Ukraine's recession-hit economy to the brink.
The International Monetary Fund has stepped in with a $17.5 billion rescue loan. As part of that deal, Ukraine must save a further $15 billion over four years by restructuring its debts.
"If the debt operation fails, Ukraine will lose a big share of the package," said Konstantin Kucherenko, a fixed-income trader at Kiev-based investment group Dragon Capital.
"The funds that other multilateral and bilateral donors provide will not be sufficient to keep the Ukrainian economy running for the next four years," he said.
The IMF has so far dished out $5.0 billion to Ukraine and must decide in June whether Kiev has met the terms for the next slice. With that deadline looming, Ukraine is trying to persuade investors to cut it some slack.
AFP
