The Cabinet of Ministers of Ukraine, if necessary, can temporarily suspend payments on external public debt until October 1, 2024; the corresponding law No. 3880-IX was signed by Ukrainian President Volodymyr Zelenskyy.

As reported on the website of the Verkhovna Rada, the law adopted on July 18 (passed by parliament under No. 11396) was sent to the president for signature on July 24 and returned with the signature on July 31.

The document amends the Budget Code, giving the government the right to suspend payments on external public debt if necessary. In addition, it makes it possible to include in the "perimeter" of public debt restructuring a series of Ukravtodor eurobonds for 2021 for a total of $700 million with interest.

A similar technical solution on the government's right to suspend payments on public debt was already used during the restructuring in 2015, when Ukraine adopted the law on the specifics of transactions with public, publicly guaranteed and local debt in May, reached fundamental agreements with investors in late August and announced the completion of the operation in November.

"The IMF has routinely expressed support for this bill, as it will help strengthen Ukraine's debt sustainability - a commitment we made in the Memorandum with the IMF," Roksolana Pidlasa, head of the parliamentary budget committee, emphasized before the law was adopted.

As reported, Ukraine announced on July 22 that it had reached agreements in principle with a special committee of holders of its eurobonds worth about $23 billion on their restructuring. They envisage writing off 37% of the debt with the possibility of restoring 12% if a certain level of GDP is reached in 2028. New bonds will be issued for the remaining debt, maturing in 2029-2036, with interest rates gradually increasing from 1.75% in the coming years to 7.75% at the end of the circulation period. A fee of 1.25% of the amount of the exchanged eurobonds will be paid for participation in such an exchange.

Ukraine expects to be able to complete all negotiations with bondholders by August 1, when payments on eurobonds come due under the terms of the 2022 restructuring.