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Wednesday, 18 December
economy

Ukraine has a record external debt: how big a threat is it?

Most of the financial aid coming to Ukraine from Allies are loans that will have to be repaid, and which increase our external public debt.

This is stated in the article "Apostrophe".

Foreign Government Loans have favorable conditions in the form of relatively low interest rates and long repayment periods, but they will still have to be paid back.

At the same time, Ukraine's external public debt amounted to more than $100 billion at the beginning of 2024, and of course, it will continue to grow. And this poses a certain threat to the country. How big is the threat?

"We now have one threat (in the form of Russian military aggression - Apostrophe), and other threats are secondary or even third-rate," Oleksandr Parashchiy, Head of the Analytical Department at Concorde Capital, told the publication.

However, Ukraine has never had such a large debt as it does now, and this is a problem.

"On the other hand, this debt is much better distributed than before the war. What we receive from Japan, Canada, and the EU is, by our standards, a very long-term debt. We will repay it starting from the fifth year, and for some (loans) from the tenth year. That is, the repayment of this debt itself does not put pressure on us yet," the expert emphasized.

Earlier we wrote that NBU may refuse to use the US dollar as the main currency of the exchange rate peg.