Moscow May Be Forced to Demand Early Repayment of $3Bln Debt by Kiev:Source

The breach of the conditions of granting a bonded loan to Ukraine may prompt Moscow to demand a repayment of the $3 billion debt by Kiev in the near future, a government source suggests.

MOSCOW, January 10 (Sputnik) — A whole range of parameters which are the conditions of granting a Russian bonded loan to Ukraine, are being violated, a source in the Russian government said Saturday.

"The situation that is emerging in the economy and finances of Ukraine suggests that a number of parameters, which are the conditions of granting Ukraine a Russian bonded loan are violated," the source said.

He also added that under these circumstances "it is likely that Russia will have to demand from Ukraine in the near future early repayment of the $3 billion debt."

Ukraine has been struggling to find a way out of a monetary crisis that has left the country’s economy in difficulty. To help restore the economy, authorities in Kiev have sought financial assistance from international financial institutions.

In spring, the IMF promised Ukraine a total of $17 billion in bailout loans, to be provided over the course of two years. So far, Ukraine has received two tranches, amounting to $4.55 billion.

Financial assistance to Kiev is also provided by the World Bank, EBRD (European Bank for Reconstruction and Development), European Investment Bank and a number of countries. Overall in 2014, Ukraine received financial assistance amounting to about $9 billion. The total national debt for 11 months of 2014 amounted to $69.3 billion.

In December 2013, Russia made a decision to issue Ukraine a loan of $15 billion and bought Ukraine’s first Eurobonds in the amount of $3 billion.

In November 2014, Russian President Vladimir Putin said that Russia would not demand Kiev to make an early repayment of Eurobonds in a bid to help Ukraine restore its financial system.