Russian Federation says out-of-court deal on Ukraine debt impossible

Ukraine faces a looming debt default after the country’s finance ministry said Thursday that the country can not make a $3 billion debt due to Russian Federation this weekend without violating a debt-restructuring deal with other worldwide creditors. Russian Prime Minister Dmitri Medvedev called Ukrainian officials “swindlers” for withholding repayment and stepped up threats to pursue legal action.

“Russia has refused, despite our repeated attempts to sign the agreement for restructuring, to accept our proposals”, Yatsenyuk explained.

Poroshenko, speaking alongside European Council President Donald Tusk and European Commission President Jean-Claude Juncker, said the trade accord with the EU would be implemented in full as planned on January 1 and would not be delayed. That involved a 20 percent write-down of bond holdings, which cut Ukraine’s sovereign debt from $19 billion to $15.5 billion. Moscow has previously said it will take Ukraine to court if it fails to pay on time.

“I can’t give any details, but I would like to say that we have been preparing for [launching the blockade] using all the strength and resources we have”.

Meanwhile, the IMF decided on Tuesday to change its strict policy prohibiting the fund from lending “to countries that are not making a good-faith effort to eliminate their arrears with creditors”.

“It is crucial for Ukraine’s advancement towards the European Union and Poland is ready to support Ukraine, in particular in sharing its experience in decentralisation”, Duda said. The proposed plan would have delayed Kiev’s default and allow it to repay $1 billion per year for three years, from 2016 to 2018.