S&P upgraded Ukraine’s credit rating

Thanks to the restructuring, Ukraine’s foreign currency debt repayments will drop by about 40% between 2022 and 2024, the agency said.

Rating agency Standard & Poor’s Global Ratings (S&P) has upgraded its long-term foreign currency credit rating to CCC+, with a stable outlook. Previously, the rating was at the default level of SD. It was reported on the agency’s website on Sunday, August 21.

“The rating action follows the completion of the restructuring of Ukraine’s Eurobonds,” the agency explained.

Standard&Poors also confirmed the national currency sovereign credit ratings at the CCC+/C level and upgraded the national scale rating from uaBB- to uaBB.

“The stable outlook balances our view of a reduction in Ukraine’s sovereign debt service requirements and our expectation of stable international financial support against the risks associated with the ongoing war,” S&P said.

Experts point out that thanks to the restructuring, Ukraine’s foreign currency debt repayment will decrease by about 40% between 2022 and 2024, to about $10 billion from $16 billion.

“As a result, short-term risks to the government’s liquidity position and, more broadly, the ability to repay commercial debt, including in foreign currencies, appear to be manageable,” the agency said.

At the same time, it was noted that Ukraine’s ability to service its debt remains weak and depends on favorable financial and economic conditions, while in the context of the ongoing war with Russia, there are many factors that are largely beyond government control. .

Earlier, rating agencies S&P and Fitch downgraded Ukraine’s foreign currency rating to pre-default levels. This is due to Ukraine’s external debt.

But Ukraine was given a reprieve on its foreign debt. Foreign creditors have frozen payments on international bonds for two years to prevent the country from defaulting. Shortly thereafter, Fitch upgraded Ukraine’s credit rating.

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