Ukraine to default on payment to GDP warrant holders
The war-ravaged country said it owes $665 million on June 2 to holders of the $3.2 billion worth of warrants, based on 2023 economic performance.
Last year, Ukraine's parliament approved a payment moratorium on the GDP-linked securities from May 31.
"Ukraine remains committed to implementing a comprehensive, fair and equitable restructuring of the GDP-linked Securities," it said in a statement, adding it must comply with debt targets outlined in its IMF programme and in line with the comparability of treatment with official lenders.
Ukraine created the instruments - fixed income securities indexed to economic growth - to sweeten its 2015 debt restructuring. But their complex structure meant they had not been part of last year's broader $20 billion restructuring.
Ukraine's economy cratered after Russia's full-scale invasion in 2022, falling close to 30%. And while its economy staged modest growth in 2023 and 2024, its gross domestic product remains below the pre-war level.
Finance Minister Serhii Marchenko described the warrants, with a payout linked to growth, as "designed for a world that no longer exists".
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