Ukraine in 2014 will borrow up to CAD 200 million (currently USD1/CAD1.1087) for a period of up to five years at 3 percent per annum, according to cabinet resolution No. 443 of Sep. 15, 2014, which was published on Monday.
According to the resolution, the commission is 0.3 percent of the principal of the loan or CAD 600,000. The interest payments are to be made every six months.
According to the market players, the non-market rate means that this is an interstate loan, or that the guarantees of a high-quality creditor are being given. It is likely that this was the Canadian government, as the loan is being taken in the currency of that country.
The Stand-By Arrangement (SBA) worth SDR 10.97 billion ($16.67 billion) from the International Monetary Fund (IMF) was approved on April 30, 2014, to support the Ukrainian government’s economic, which aims to restore macroeconomic stability, strengthen economic governance and transparency, and launch sound and sustainable economic growth while protecting the vulnerable groups.
The IMF has issued two disbursements worth $4.51 billion, and by the end of the year the decision to issue the united third and fourth disbursements worth $2.8 billion could be made.
Ukraine placed five-year foreign bonds at 1.844 percent per annum against U.S. guarantees in the middle of May 2014.
The European Union, to finance the first tranche of its macro-financial assistance to Ukraine, on June 10 placed a tranche of ten-year bonds worth EUR 500 million on the market. The funds are to be transferred to Kyiv. The rate of bond placement was 1.545 percent per annum.
