Ukraine’s Jaresko Skipping ‘Technical’ Debt Meetings With IMF

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Ukraine’s Finance Minister Natalie Jaresko won’t attend talks in Washington, scheduled for next week with creditors and the IMF, because they are technical meetings to discuss economic forecasts and not debt negotiations.

Special Envoy for State Debt Negotiations Vitaliy Lisovenko will attend the meetings in her place, she told reporters in Kiev Thursday.

“Those are not talks,” she said. “It’s a technical meeting to discuss the new macroeconomic forecasts on which our new proposal is based. The macroeconomic forecasts are not public yet as we have not reached our staff-level agreement with the IMF.”

A creditor group that owns about $9 billion of Ukraine’s foreign-currency debt sent a proposal to the Finance Ministry last month that, they say, meets the IMF’s three targets through maturity extensions and coupon reductions alone. Ukraine rejected the plan and returned with a counter-proposal based on updated IMF economic forecasts last Friday. The bondholders have repeatedly asked for the latest numbers so that it can assess Ukraine’s offer.

IMF Managing Director Christine Lagarde appeared on June 12 to back the Finance Ministry’s objection to the creditor offer when she said that servicing debt out of international reserves would be “inconsistent” with the goals of the restructuring. The creditor committee’s proposal leaves the nation with “an appropriate level of reserves,” while acknowledging that they would be higher “absent repayments to foreign-currency creditors, including the IMF,” the creditor committee said in a statement yesterday.

It will be the IMF that tells creditors what level of reserves Ukraine should have and not us, Jaresko said today.