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| Ukrainian Default | |
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| Tweet Topic Started: Jul 2 2015, 01:08 AM (171 Views) | |
| Litos | Jul 2 2015, 01:08 AM Post #1 |
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Itō Hirobumi
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Germany notes with grave concern this development that has spun the financial markets of Kiev out of control, and we help the EU embalmer states will join us in coming up with some sort of financial deal that could postpone interest payments for a couple years with major European banks in exchange for all things being returned. This would calm markets, though Ukraine would still be in an economic nosedive. We should call for all debt to be repaid - we cannot show hypocrisy in the face of states trying to attack us by demanding Greek payments while a non-EU member defaults on European banks' loans, but we should help Ukraine get stability to avoid total implosion, the route that it is going down. Our reconstruction should be partial and lead only to a full reconstruction after consultation to form a civilian coalition government to replace the military. |
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| Sadar | Jul 2 2015, 11:13 PM Post #2 |
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We think its time to cut the flow. We have an exposure of X to Ukraine, IMF has refinanced Ukraine bail, a day later Ukraine announces large investments in the military sector and then defaults on the loan. It the EU keeps pumping money in the form of loans in Ukraine we are going to multiply our exposure to them and what nkw is a sma loose can be ome a very large one. We think we should cut any financing or refinancing of Ukraine whe its not too expensive, sit with them and restructure our current debt. Once thats done, we support starting talks or a new loan or bail thats includes an actual collateral from Ukraine to reduce credit risk. |
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| iceviking | Jul 3 2015, 12:43 AM Post #3 |
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Italy shares Gernan and French concerns, we agree that the EU needs to review funding Ukraine. Italy is in no shape to lose money. We suggest an meeting with Ukrainian officials to discuss the crisis. |
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| Litos | Jul 3 2015, 04:18 AM Post #4 |
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Itō Hirobumi
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If we're going the direction of cutting it off, if the EU collaborates we could fully compensate our countries and banks by using EU law to seize Ukrainian government assets and foreign reserve deposits, if our money is our highest concern. |
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| winisle | Jul 3 2015, 01:43 PM Post #5 |
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We must find the golden middleground, where we protect our own economy without doing undue harm to the Ukrainian economy. Thus the UK advocates a way where we limit our future exposure to the Ukraine, where we are open to discussions on a moritorium on interest payments, and possibly on a moritorium on payment of the balance of the debts, but the UK will not agree to furnish the Ukraine with further funds, nor do we see, at this time, a position where the debts is forgiven, even partly. |
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| Sadar | Jul 5 2015, 07:33 AM Post #6 |
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Seizing assets should be off the table for the time being. As stated by the UK, lets solve the current debentures issues before any refinacing being possible. If Ukraine insists in defaulting, we advocate to cut off ukraine debt as core capital assets from the Eurozone financial systems. But for now, indeed no more financing flows shall take place. |
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| iceviking | Jul 5 2015, 10:43 AM Post #7 |
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Italy agrees we should not freeze assets. This will be the last resort. We urge talks with Ukraine. For the time being Italy is not able or willing to refinance Ukraine. Italy is trying to sort out its books first, then we can sort out Ukraine. |
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| Litos | Jul 5 2015, 10:31 PM Post #8 |
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Itō Hirobumi
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Reinhard Silberberg Permanent Representative to the EU We only suggested that if money is our highest priority we must seize assets. If instead we are looking at the bigger picture, then cutting off aid nad other half-measures will no solve the problem. Te alternative to this Ukrainian government is a Russian-backed government. Therefore, we must pass a restructuring package that convinces the government to pay loans with a delayed interest in exchange for help in negotiating its debt obligations in wartime. |
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| Sadar | Jul 6 2015, 02:48 AM Post #9 |
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Seizing asseets has several problems: Jurisdiction: We can seize ukranian assets within our borders... but surely that is not good for a business friendly model that we claim to defend, and we doubt that their foreign assets make it up for the hole debt. Then, seizing ukranian assets within Ukraine is even more unrealistic. Relevance: Both public and private entities from the EU have loans with Ukraine. However, its with the ukranian government and not the private sector that the debt relates to. So how can we seize assets from a government? Clearly as stated by the US, they could compensate debtholders with shares in state-owned companies. That could do it, but it requires Ukraine to agree on that. |
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| Sadar | Jul 6 2015, 01:45 PM Post #10 |
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What do other EU memberss think of offering Ukraine the possibility to swap debt against a proportionate stake in state owned companies. |
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