Ukraine has failed to reach an agreement with investors on the restructuring of $2.6 billion in debt, potentially leading to a default as early as May, according to the Financial Times.
The newspaper reports that next month Kyiv is due to pay nearly $600 million on GDP-linked warrants — securities whose payouts depend on the country’s economic growth. These payments are tied to Ukraine’s economic performance in 2023 and are scheduled to be made at the end of May.
Kyiv must decide whether to default on the nearly $600 million payment if it cannot reach a deal with bondholders in time, FT writes.
Ukraine’s Ministry of Finance stated that it is continuing negotiations and “considering all available options” to resolve the situation.
Meanwhile, the International Monetary Fund has previously warned that failure to resolve the issue with these warrants could pose a “serious risk” to the stability of its current $15.5 billion aid program and to the results of last year’s $20+ billion debt restructuring.
