Fitch removes 'partial default' for Ukraine after debt deal
Washington, Nov 18, 2015 (AFP) -- Ratings agency Fitch removed its "partial default" rating for Ukraine Wednesday after the country completed its bond restructuring deal and resumed servicing its debts.
Fitch upgraded its rating to a still basement-level CCC, noting that the restructuring, agreed to in August but only completed last week, had allowed Kiev to issue new bonds against those defaulted on in October in a move to make the country's finances more sustainable.
The restructuring lengthens the payment period on Ukraine's massive debt and was a crucial component of the International Monetary Fund's $17.5 billion financial rescue of the country agreed to in March.
"Public debt sustainability has improved," Fitch said.
"Reduced refinancing needs and a pipeline of official financing give the public and external finances some breathing room and lower the risk of a sovereign debt crisis over the short- to medium-term."
Kiev still has to resolve a $3 billion debt dispute with Moscow, which could threaten the overall program.
Moscow has insisted that Ukraine repay by December the loans Russia made to then-president Viktor Yanukovych ahead of his ouster in February 2014.
On Monday, Russia said it has a new proposal on how to resolve the dispute, but gave no details.
Last week, Ukrainian Prime Minister Arseniy Yatsenyuk reiterated that Kiev would not offer Moscow "better conditions" than to private creditors.
This ends our live blogging for November 18. Be sure to check back tomorrow for our continuing coverage.
As reported earlier, Russia is set to ban Ukraine food imports:
Russia has announced it will ban all food imports from Ukraine starting on January 1.
Russian Economy Minister Aleksei Ulyukayev told TV channel Rossia-24 on November 18 that Russia was taking the action "because Ukraine has joined the sanctions against the Russian Federation -- economic and financial."
Russia has been slapped with Western sanctions for annexing Ukraine's Crimea Peninsula and supporting pro-Russian separatists in eastern Ukraine.
More than 7,900 people have died in the conflict in eastern Ukraine, according to UN estimates.
Moscow, which denies any role in the conflict, has already imposed its own food bans on the EU, the United States, and other Western countries.
Ukrainian Prime Minister Arseniy Yatsenyuk said the pending Russian action will cost Ukraine's economy some $600 million in 2016.
On the other hand, Yatsenyuk noted the Ukrainian economy was now less dependent on Russia.
"While earlier our dependence was 35 percent, now it's at the level of 12.5 percent," Yatsenyuk said on November 18, according to a statement on his cabinet's website. (AFP, dpa)