MOSCOW, June 9. /TASS/. Ukraine has in fact gone bankrupt by refusing to repay its obligations and failing to avert a default, said Nikolay Azarov, who served as the country’s prime minister in 2010-2014.
"Ukraine is not one step away from a default; in fact, its default has long begun as Kiev is not repaying its obligations. If a country acts like one facing a default, it means it has already gone insolvent," he wrote on Telegram. According to Azarov, "all rating agencies refer to Ukraine's government obligations as junk in their evaluations."
In early June, Ukraine faced a technical default on some of its obligations, namely state derivatives, after failing to pay the necessary amount of money to their holders. State derivatives make up a small portion of the country’s national debt, but the move by Kiev to actually abandon its commitments has already caused a negative reaction from the International Monetary Fund. The fund did not rule out that such a decision could negatively affect efforts to restructure Ukraine’s debt.
In late May, the Fitch Ratings international agency confirmed the long-term issuer default rating of Ukraine in foreign currency at the RD level, which means Restricted Default. According to the agency, the rating will remain in place until Kiev normalizes relations with a large majority of its foreign creditors.
According to Daniil Getmantsev, head of the Verkhovna Rada (Ukraine’s parliament) Committee on Finances and Tax and Customs Policy, the national debt rose by almost 5% to $180 billion in April. External debt constitutes 74.5% of the national debt. Ukraine’s media outlet Ekonomicheskaya Pravda (or Economic Truth) predicts that the overall state debt will reach 110% of GDP this year.