Russia, Ukraine fail to reach deal on Kiev debt

Russia’s justice minister says Moscow is open to discussing handing over to Kiev a Ukrainian pilot charged with the murder of two journalists.

“If Savchenko is convicted and there is an agreement, we could discuss the issue of the transfer”, Konovalov said.

The decision was taken by theState Aviation Service of Ukraine because Russia’s Federal Air Transport Agency (Rosaviatsia) did not provide explanations why it had introduced a ban on Ukrainian airlines’ flights.

Ukraine has agreed a debt restructuring deal with a group of its largest creditors in order to plug a $15 billion funding gap under an global Monetary Fund-led $40 billion bailout program, but major creditors still need to approve the plan.

If the impasse is not resolved, Ukraine is set to default when the Russian-held bond comes due in December.

Ukraine has been pushed to the brink of bankruptcy following over a year of political upheaval and conflict with pro-Russia forces in the east.

Moscow will not compromise on Ukraine’s debt, Russian Finance Minister Anton Siluanov said October 9 before meeting with Ukrainian Finance Minister Natalia Yaresko. UTair was the only Russian carrier not included on the sanctions list.

“The best for Russian Federation is to join other investors, so they would gain a value recovery instrument that could allow them to regain if there’s growth in the (Ukrainian) economy”, added the source.