Ukraine’s Public Debt at USD 80bn, Implying 54% Debt/GDP Ratio

May 05, 2020

The Finance Ministry reported that Ukraine’s overall public debt stood at USD 80.4bn as of Apr 1, decreasing in USD terms by 3.6% MoM amid a 12% devaluation in the national currency in March. Meanwhile, in UAH terms, the country’s public debt grew by 10.1% to UAH 2.26tn. MinFin raised UAH 33bn through primary treasury auctions in March. Debt redemptions amounted to UAH 9.6bn in March while the debt servicing costs were at UAH 20.1bn in the period.

We estimate Ukraine’s debt to GDP ratio at a manageable 54%. Nevertheless, it is expected that the ratio will rise to at least 65% by year-end as the government needs ramp up its borrowings to finance a very large budget deficit, which could reach an equivalent of 8% of GDP this year compared to the initial target of the deficit at 2% of GDP.
In terms of the public debt structure, domestic hryvnia-denominated debt accounted for 32%, followed by Eurobonds (29%), debt to the IMF and other IFIs (15%), domestic foreign currency-denominated debt (6%), and ‘other debt’ (18%).
The country’s debt redemption and servicing payments are estimated at UAH 331bn (USD 12.2bn) in May-Dec 2020. In this period, MinFin should pay out UAH 186bn (USD 6.9bn) to cover the country’s internal debt, and USD 5.3bn for external obligations. In May alone, redemptions coming due are UAH 68bn (USD 2.5bn), including a USD 1bn Eurobond redemption.

Eavex Capital welcomes any questions or comments you may have regarding our research products.
Please contact our office in Kyiv at 380-44-590-5454, or by email:
Alexander Klymchuk, Head of Sales,
Dmitry Churin, Head of Research,