Moscow previously proposed that Ukraine restructure this debt, allowing it to pay one billion rubles in 2016-2018. "Essentially, it will not be able to seize the Ukrainian state's assets, since the IMF will be able to claim that these assets are encumbered by an IMF loan," Kirill Koktysh stated, adding that "sooner or later, in any case, the debts (to Ukraine – ed.) will have to be repaid, and there is no escape."
"Another issue is that Russia's ability to demand (debt repayment – ed.) will be curtailed." Current President Petro Poroshenko called the loan a "bribe" that the former president received in 2013 for refusing to sign the Association Agreement with the European Union. Russia refused to participate in the restructuring, insisting on the official status of the debt.
Amid the crisis and the gradual decline of the dollar as the world's reserve currency, the IMF could theoretically have claimed a significant boost to its role in the global financial system. However, in Ukraine's case, the IMF made an exception and waived the bankruptcy rule. Moody's experts believe that easing the requirements for IMF borrowers eliminates the need for the Ukrainian capital to make a difficult choice between adhering to the Fund's program and using part of its reserves to repay Eurobonds held by the Russian Federation.
Meanwhile, in order for the IMF to continue providing funds to countries that are in default or default on their debt obligations to a sovereign (in the Fund's terminology, an "official") creditor, three criteria must be met.
However, on December 8, 2015, the IMF's board of directors decided to lift this restriction. This was stated in an announcement by the Ukrainian Minister of Finance after the IMF designated the loan as official debt.
According to RIA Novosti, citing a Global Fund employee, the vote on the debt status took place in absentia, with notifications containing a draft resolution sent to directors. Last Friday, Kyiv, through Prime Minister Arseniy Yatsenyuk, promised to impose a moratorium on loan repayments if Moscow did not agree to a debt restructuring.
Kyiv refuses to pay the debt. With the IMF's recognition, the condition no longer applies to Russian securities. Kyiv has declared its readiness for legal proceedings.
