MOSCOW (AP) – Ukraine won’t make a $3 billion debt repayment due to Russia this weekend because Moscow refused to agree to terms already accepted by other international creditors, Ukraine’s prime minister said Friday.
The “moratorium” on outstanding debt repayments to Russia announced by Ukrainian Prime Minister Arseniy Yatsenyuk effectively means that Ukraine is defaulting on the debt due Sunday. That move could jeopardize crucial loans that Ukraine has been receiving from a $17.5 billion bailout deal with the International Monetary Fund.
It’s the latest spat between the two neighbors following a run of gas supply disputes, Russia’s 2014 annexation of the Crimean Peninsula and its support for separatists in eastern Ukraine.
“After Russia refused to accept our offer, despite our attempts to reach a restructuring deal, the government is imposing a moratorium on the repayment of the $3 billion debt to Russia,” Yatsenyuk said at a televised government session. “We are ready for court proceedings with Russia.”
He did not indicate when Ukraine would be ready to repay the debt. Moscow has previously said it will take Ukraine to court if it fails to pay on time.