(Adds details on creditor proposal, IMF bailout tranche)
WASHINGTON, June 10 Ukraine cannot wait until
September to reach an agreement with its creditors to find some
$15.3 billion in savings before it is forced to call a
moratorium on debt payments, Finance Minister Natalia Yaresko
said on Wednesday.
She also repeated that she expects the International
Monetary Fund to release its next $1.7 billion tranche of aid to
Kiev in July, even if there is no agreement on a debt
restructuring by then.
Ukraine's parliament passed a law last month that would
allow the government to impose a moratorium on foreign debt
payments if necessary.
"I don't think we have that much time," Yaresko told
reporters, when asked if debt negotiations could last past the
summer. "In that respect, I'd have to use other tools to reduce
the pressure on the balance of payments, a moratorium."
Yaresko and Ukrainian Prime Minister Arseny Yatseniuk are in
Washington this week to meet with the IMF, promote Ukraine as an
investment destination, and ask U.S. officials for more economic
and military support.
Kiev has been driven to the edge of default by economic
mismanagement and a separatist conflict in the east. Now, as one
of the conditions of an IMF-led $40 billion bailout program, it
is trying to reach a restructuring agreement with bondholders.
But the two sides have failed so far to see eye-to-eye, with
a powerful creditors' committee refusing to offer a writedown on
part of the debt which Kiev is pressing for.
"If we're not able to make progress, then the creditors will
be provoking the use of that (moratorium)," Yaresko said, adding
that the government has already paid some $2 billion in
repayments to creditors since last year, despite fighting a
conflict in the east.
She declined to say whether Kiev would make its coupon
payments to bondholders next week.
The creditors' committee has proposed drawing some $8
billion from Kiev's central bank reserves as part of the
restructuring plan, which Yaresko has called "unacceptable." She
said such a plan undermines the very purpose of Kiev's economic
program from the IMF and other donors, which aims to bolster the
level of central bank reserves.
As part of the IMF's $17.5 billion in support, Kiev must
still complete three prior actions, including improving central
bank independence, before the IMF can release the next tranche
of aid. Yaresko said she expects parliament to vote on the
measures next week.
(Reporting by Anna Yukhananov; Editing by Tom Brown and Lisa