Ukraine Wants to Defer $390-Mln Debt to Russia

KIEV, January 30 (RIA Novosti) – Ukraine does not have enough budget funds to pay its $390 million debt to Russia by the year-end and needs more time to comply with an earlier court ruling ordering it to do so, Justice Minister Oleksandr Lavrynovych said on Wednesday.

“Ukraine’s state budget does not have enough funds to pay off the entire amount of the debt in line with the court’s ruling,” Lavrynovych said. “I think we are going to enter negotiations [with Russia] to prolong the implementation of this decision.”

On September 19, the Kiev Economic Court partially ruled in favor of the Russian Defense Ministry, in a lawsuit obliging Ukraine to pay over $389 million in debt owed by United Energy Systems of Ukraine (UES) dating back to the 1990s, when former Prime Minister Yulia Tymoshenko headed the corporation.

The Ukrainian government, then led by Pavlo Lazarenko, provided state guarantees for the payment of that debt.

Tymoshenko is currently on trial on charges of illegally using government money to cover UES’ debts to Russia in 1996. She is already serving a seven-year sentence for abuse of her authority in signing a separate 2009 gas deal.

The Ukrainian Justice Ministry has appealed the September Kiev court ruling, but the Ukrainian Supreme Economic Court upheld it on January 21, in a final decision final without the possibility of further appeals.

On January 18, Ukraine made its first payment of $1.8 million of the UES debt to Russia.


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