The Ministry of Finance intends to float Eurobonds worth $1 billion against guarantees of the US government in November 2015.
The Minister of Finance Natalie Jaresko told this at a ministry board meeting.
In May 2015, the Government of Ukraine signed an agreement with the US government on loan guarantees for Ukraine for $1 billion under the $2 billion guarantee declaration with a possibility for this amount to be increased by another $1 billion provided Ukraine succeeds in reforms.
“When the current government was formed more than half a year ago, the Ukrainian economy was in a critical condition which required “intensive care”, to put it in medical terms. That meant tremendous challenges and tasks for the Ministry of Finance which were the recovery of the public financial system and stabilization of the budgetary and banking system of Ukraine. We coped with these tasks: in the first half of the year we managed to keep the stable and steady functioning of the budgetary and financial system of Ukraine”, Natalie Jaresko said in the beginning of her speech.
According to the Ministry of Finance, along with the mentioned funds, external revenues from international donors and partners for more than $3.2 billion are expected by the end of the year.
“One of the important achievements of the Ministry in this half of the year is that we managed to balance the state finances and to cut the real budget deficit to the sum which is to be covered from sources other than emission. To do that, a realistic budget for 2015 and amendments to this budget were adopted which enabled us to increase the defense budget as well as to scale up social protection for the most affected groups of citizens by providing direct subsidies to them mitigating the increased tariffs for gas and heating. At the same time, the monetary pressure on the economy was lowered due to the reduced deficit of Naftogaz and the Pension Fund”, the Minister of Finance emphasized.
The ministry intends for two tranches of $500 million each from the World Bank in late August and September, €600 million from the European Commission in the forth quarter, $300 million from the Government of Japan in late October, €200 million from the German government in late August and 200 million of Norwegian krones from the Government of Norway in October.
The IMF as a key creditor of Ukraine confirmed the board of directors’ intention to decide on another tranche for Ukraine under the EFF program until July 31 this year. Thus, the total amount of funds allocated to Ukraine under the EFF program will make $6.68 billion.