15:46 15.02.2016

No instrument to repay Ukraine's debt tied to Black Sea fleet to Russia - Finance Ministry

2 min read
No instrument to repay Ukraine's debt tied to Black Sea fleet to Russia - Finance Ministry

The denunciation by Russia of agreements with Ukraine related to the Black Sea fleet made it impossible to service and repay the debt of $605.86 million, which was previously repaid by the annual offset of $97.75 million by Kyiv on the public debt and Moscow's payment for the use of the Black Sea fleet base in Crimea, Ukraine's Ministry of Finance has said.

"At present there is no instrument to service and repay the debt as Russia unilaterally stopped, denounced these agreements," the director of the debt policy department at the Ministry of Finance, Halyna Pakhachuk, said at the round table "The Ministry of Finance's policy in the domestic borrowing market in 2016."

"Accordingly, the debt is accounted but it is not serviced," she stated.

As reported, Ukraine and Russia in the first quarter of 2015 for the first time since 1997 stopped carrying out the said annual mutual settlement, which was regulated by the intergovernmental agreement dated 1997 on cross charge related to the division of the Black Sea fleet and the Russian Black Sea fleet's staying in Ukraine. The document was signed by Prime Ministers Viktor Chernomyrdin and Pavlo Lazarenko in Kyiv on May 28, 1997.

"This agreement is valid until the full execution by the parties of the obligations arising from it," reads the agreement.

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