Analysis
Ukraine has defaulted on its GDP warrants. What are the consequences for the economy and citizens?
The default on GDP warrants is not a collapse, but a technical step. It will help the Ministry of Finance manage its debt burden. But it will affect the image and future loans
On June 3, S&P Global downgraded Ukraine's GDP-linked bond rating from CC to D.
The agency's website says that on June 2, the Ministry of Finance missed a payment of more than $665 million tied to economic growth rates for 2023. The agency did not wait for the 10-day grace period to expire to make the payment and immediately recognized the default.
What does it mean if Ukraine defaults on its GDP warrants and is it a complete state default? What consequences will this default have for Ukraine, its economy and citizens? What are GDP warrants, why were they issued in 2015, and what does the Ministry of Finance of Ukraine propose to resolve this situation? Told by LIGA.net.