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A Russian government source told us, “The situation emerging in the Ukrainian economy and financial outlook suggests that a number of parameters used to grant the Ukraine a Russian bond issue are now moot. In these circumstances, it’s likely that Russia would demand an early repayment of the 3 billion USD (188.7 billion Roubles. 18.64 billion Renminbi. 189.62 billion INR. 3.54 billion CAD. 3.72 billion AUD. 2.54 billion Euros. 1.98 billion UK Pounds) debt owed us from the Ukraine in the near future”. Earlier, sources familiar with negotiations on economic assistance to the Ukraine said that Russia could offer to defer the repayment of Ukrainian Eurobonds for 3 billion USD from the end of 2015 until at least the end of International Monetary Fund (IMF) programme, which would last several years. Otherwise, international financial institutions might be reluctant to allow the Ukraine to make new loans. As one source familiar with the negotiations between Kiev and the IMF told us, in 2015, the Ukraine has to pay out 6.5 billion USD (408.86 billion Roubles. 40.38 billion Renminbi. 410.84 billion INR. 7.68 billion CAD. 8.04 billion AUD. 5.48 billion Euros. 4.3 billion UK Pounds), of which almost half represents debt to the Russian Federation. Only 1.5 billion USD (94.35 billion Roubles. 9.32 billion Renminbi. 94.81 billion INR. 1.77 billion CAD. 1.86 billion AUD. 1.27 billion Euros. 990 million UK Pounds) of it represents payments to the IMF. It turns out that if financial institutions in Europe and America raise funds for the Ukraine, the lion’s share of such government money from these countries would have to go to Russia to repay earlier loans.
The Ukraine has a serious political crisis that affects its economy and the public sector, in fact, the country is on the verge of default. The authorities want to improve their situation in re foreign borrowing. The IMF started a two-year credit programme for the Ukraine of 17.1 billion USD (1.076 trillion Roubles. 106.24 billion Renminbi. 1.08 trillion INR. 20.22 billion CAD. 21.16 billion AUD. 14.42 billion Euros. 11.3 billion UK Pounds). Of this amount, Kiev received 4.6 billion USD (289.36 billion Roubles. 28.58 billion Renminbi. 290.74 billion INR. 5.44 billion CAD. 5.7 billion AUD. 3.88 billion Euros. 3.04 billion UK Pounds) in 2014; the remaining funds should come in 2015. Kiev also got financial assistance from the World Bank, EBRD, the European Investment Bank, and a number of foreign sources. Overall, in 2014, the Ukraine received financial assistance amounting to about 9 billion USD (566.1 billion Roubles. 55.92 billion Renminbi. 568.86 billion INR. 10.62 billion CAD. 11.16 billion AUD. 7.62 billion Euros. 5.94 billion UK Pounds). In this case, the total national debt in 11 months amounted to 69.3 billion USD (4.36 trillion Roubles. 430.54 billion Renminbi. 4.38 trillion INR. 81.92 billion CAD. 85.74 billion AUD. 58.48 billion Euros. 45.84 billion UK Pounds).
In 2013, Russia decided to invest up to 15 billion USD (943.5 billion Roubles. 93.2 billion Renminbi. 948.1 billion INR. 17.7 billion CAD. 18.6 billion AUD. 12.7 billion Euros. 9.9 billion UK Pounds) in Eurobonds for the Ukraine. Russia sent the initial tranche of 3 billion USD, with a maturity of two years (coupon rate of 5 percent per annum coupon, with payments every six months). However, the Ukraine didn’t receive the remaining 12 billion USD (754.8 billion Roubles. 74.56 billion Renminbi. 758.46 billion INR. 14.16 billion CAD. 14.88 billion AUD. 10.16 billion Euros. 7.92 billion UK Pounds), as the Russian government judged that the change of government in the Ukraine was illegitimate.
10 January 2015
Rossiya Segodnya
Voices from Russia 
“Grexit” Could Cause EU Collapse
Tags: Barry Eichengreen, Berkeley, debt, Economic, economic crisis, Economic system, economics, EU, Euro, Euro Zone, Eurogroup, Europe, European Central Bank, European sovereign debt crisis, European Union, Eurozone, Greece, international organisations, National Debt, NATO, North Atlantic Treaty Organisation, political commentary, politics, Sovereign Debt Crisis, University of California
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American economist Barry Eichengreen warned that the consequences of a Greek exit from the Eurozone could be devastating, and that the governments of the monetary union are taking the possible repercussions too lightly. In an interview with Die Welt am Sonntag, Eichengreen, UC Berkeley Professor of Economics, said that the consequences “would spread to other countries. When a Portuguese family or Spanish businessperson sees that Euros have been converted into drachmas, they’ll take their money out of their accounts. That could lead to a run on the banks”. Eichengreen continued that this scenario would snowball, “investors would speculate on the next candidate to leave the Eurozone”, thus endangering the entire Euro project. He also thinks that financial markets are also guilty of miscalculation, with share prices giving an overly positive picture. “My experience as an economic historian has taught me that markets always look relaxed, until suddenly… they aren’t. From the banking crisis of 2008 to the emerging markets crises of the 1990s, anybody can take their favourite financial crisis and discover that markets are really not a good crisis indicator. In the run-up to the crash, the players were always too relaxed for too long, and then later fell into a complete panic”. Eichengreen believed that the new Greek government should be given more time, “They should be given some breathing space, which is also in the interests of their creditors. I’d be in favour of tying interest payments on the borrowing to economic growth. Only when the Greek economy grows, should the country pay interest, otherwise the payments will simply be deferred. The Euro is of great symbolic and geostrategic worth for Europe”. He added that such an eventuality on the economic front would also have consequences for the West in terms of the European geostrategic situation. He observed, “The West hardly wants Russia to be able to position itself as a saviour, and become involved”, adding that this would have “dramatic consequences” for NATO.
15 February 2015
Sputnik International
http://sputniknews.com/europe/20150215/1018299307.html