Ukraine says it can save over $7 billion by postponing debt repayments

A building destroyed by military strikes is seen in northern Saltivka, one of the most damaged residential areas of Kharkiv, Ukraine. PHOTO: REUTERS

KYIV (REUTERS) - Ukraine can save 200 billion hryvnias (S$7.5 billion) for priority needs by deferring its external debt repayments, Prime Minister Denys Shmyhal said on Tuesday (July 26).

Ukraine has launched a formal consent solicitation to holders of its international bonds, proposing a two-year debt freeze on most of its bonds and giving creditors until Aug 9 to vote on the proposal.

Mr Shmyhal also said the Ukrainian government had approved a request to the US government for a "gas lend-lease" arrangement to help Ukraine through what he said would be the toughest heating season in its history.

Mr Yuriy Vitrenko, chief executive of Ukraine's state oil and gas company Naftogaz, said last week the company was working with the government to raise US$8 billion (S$11 billion) in funds to buy four billion extra cubic metres (bcm) of gas needed for Ukraine's 2022/23 heating season.

Mr Vitrenko said on July 18 that Ukraine currently had reserves of 11.5 bcm and had secured funding for imports to get reserves up to 15 bcm, but that a higher target of 19 bcm had been set by the government due to Russia's invasion of Ukraine.

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