The decision to downgrade to Caa3 contributed, in particular, to the risks for serving Ukraine’s public debt due to the war.
International rating agency Moody’s Investors Service downgraded Ukraine’s long -term credit rating from Caa2 to Caa3, with a “negative” outlook. On Saturday, May 21, the agency said in a statement.
It was noted that the downgrade was due to the increased risk of repayment of Ukraine’s public debt due to Russia’s aggression, as well as the longer duration of active combat predicted by Moody’s. All of these factors increase the likelihood of debt restructuring.
While Ukraine receives significant international financial support to help mitigate immediate liquidity risks, this will lead to a significant increase in public debt in the medium term.
Concerns about the ability to repay such debt in the future could impede Ukraine’s continued access to funding to service commercial debt.
The negative forecast indicates that there is a high level of uncertainty about the further consequences of a comprehensive war, in particular, the credit. The continuation of the war will keep funding needs at a very high level for an extended period of time, and then lead to a further increase in the debt burden.
Earlier today it was reported that Portugal will provide Ukraine with € 250 million in financial assistance. Ukraine should receive the first tranche of up to 100 million euros this year, the Prime Minister of Portugal promised.
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Source: korrespondent
I am Dylan Hudson, a dedicated and experienced journalist in the news industry. I have been working for Buna Times, as an author since 2018. My expertise lies in covering sports sections of the website and providing readers with reliable information on current sporting events.