(Newswire.net — May 22, 2015) — Ukraine has passed a bill, allowing a moratorium on foreign debt payments, blaming Russia for the move. The foreign investors have filed 19 lawsuits so far, claiming $8.2 billion from Ukraine, Deputy Justice Minister Anton Yanchuk said Wednesday. Among foreign investors, there are companies from Western Europe, United States, and some of Ukraine’s neighboring countries including Russia.
The bill still needs to be signed by Ukraine’s President Petro Poroshenko to come into effect, Russia Today reported.
Beside the Russian aggression, the Minister blames a strong inflation and oligarchs, that according to some reports used the money from foreign investors to enlarge their own wealth, UNIAN reported Thursday. Yanchuk added that Ukrainian oligarchs are aggravating the situation using the difficulty in the economy for profit.
According to Deputy Justice Minister Yanchuk, another issue is a wrecked Ukrainian justice system which fails to process the accused ones.
Ukraine is estimated to be more than $50 billion in debt, however the exact figure has not yet being calculated. Ukraine’s government unilaterally stopped all payments to foreign investors calling them “unscrupulous creditors”.
“Foreign leaders should share the heavy burden of debt and the ailing economy with the Ukrainian people,” Ukrainian parliament concluded Tuesday when they passed the bill.
According to the National Bank of Ukraine, the total debt in 2014 was 71 percent of GDP, with an estimated unpayable 93 percent of GDP in 2015.
Russia could join foreign investors suing Kiev if it fails to repay $3 billion in Eurobonds, sold to Russia at the end of 2013, Russia’s Finance Minister Anton Siluanov warned this week.
A $75 million interest payment on the debt is due in June, and if Ukraine misses it, Russia will use its right to go to court, he said.