Ukraine Faces Default Risk as Russia Puts Neighbor on Notice

The economic pressure being applied by Russia is threatening to push Ukraine to the brink of default, putting the burden on the U.S. and its allies to keep the war-ravaged nation afloat.

The question of Russia calling a $3 billion bond, which Prime Minister Dmitry Medvedev this week said will “soon” be decided, is pushing the government in Kiev toward debt-restructuring talks with other creditors, according to economists from London to New York. Such a request by the Kremlin would trigger a sovereign default for Ukraine, said Regis Chatellier, a strategist at Societe Generale SA in London.