Ukraine Seen Kicking Can Down the Road With Debt Deal: Analysts
- 20 percent principal cut seen as `soft' by Societe Generale
- IMF growth targets were too optimistic: Union Investment
A serviceman next to a destroyed tank on the position of Ukrainian forces in the Lugansk region on August 26, 2015.
Photographer: Anatoli Stepanov/AFP via Getty ImagesThis article is for subscribers only.
As soon as Ukraine announced details of a deal to restructure about $18 billion of Eurobonds, analysts began questioning whether the agreement will leave the war-torn nation with a sustainable debt burden.
The accord, which still needs approvals, will see creditors accept a 20 percent principal writedown, maturity extensions of four years and interest payments set at 7.75 percent, the Ukrainian Finance Ministry said on Thursday. Sovereign bonds due in July 2017 soared 13.4 cents on the dollar to 68.99 cents.