Ukraine imposes moratorium on debt payments to Russia

Ukraine has imposed a moratorium on repayments of its multi-billion debts to Russia, Ukrainian Prime Minister Arseny Yatsenuk announced here on Friday.

"From now on, the payments on the debts totaling 3.582 billion U.S. dollars to the Russian side will be stopped until the moment, when our restructuring proposal is accepted or the court takes a relevant decision," Yatsenyuk told a cabinet meeting.

In particular, the ban on payments will apply to a 3-billion-dollar loan in the form of Eurobonds borrowed from Russia by the cabinet in December 2013 and several government-guaranteed loans totally worth 582 million dollars, Yatsenyuk said.

Kiev's move to impose a ban on debt repayments came as a total surprise as on Thursday the country's Finance Ministry said it was committed to a dialogue with Moscow over a possible credit relief deal.

The Ukrainian parliament has allowed the government to impose a moratorium on state debt repayment in May.

In August, the Ukrainian cabinet and a group of its other international creditors have reached an agreement, which envisages a 20-percent write-off of 15 billion U.S. dollars of Kiev's foreign debts and a 4-year extension of the loan repayment period.

Three months later, Ukraine offered Russia the same conditions of the restructuring, but Moscow rejected the proposal suggesting instead a debt-relief plan, under which Kiev could repay its arrears in three instalments of 1 billion dollars each within the next three years.

Ukraine's 3-billion-dollar debt to Russia matures on Dec. 20. Moscow said it would file a lawsuit against Kiev to the international court if the payments were not met. Endit