Ukraine's debt declined 1.37% in January after government repayments exceeded borrowing, the finance ministry said.
Ukraine's foreign debt fell 0.84% in the first month of the year and totaled $9.7 billion as of January 31, the ministry said in a statement on its Web site today. The government's domestic debt declined 2.41% in January and totaled $3.2 billion. Ukraine's foreign debt grew faster than planned in 2006 because the government failed to sell some state assets and had to borrow abroad to cover the budget deficit. Asset sales raised $119 million in 2006, compared with $4.1 billion the previous year as disagreements between government agencies delayed various sales, including shares in national phone company VAT Ukrtelecom. The government sold 384 million Swiss francs ($307 million) of 12-year bonds in September. It doubled the sale to 768 million Swiss francs on December 7. Ukraine sold $1 billion bonds on November 15 and 35.1 billion of yen-denominated bonds on December 18. The country plans to resume foreign and domestic bond sales in the Q2 of 2007 as the fiscal deficit widens, Finance Minister Mykola Azarov said in Kiev on December 29. Ukraine's state debt is expected to be 17.6% of GDP at the end of 2007, the ministry said in the statement. Fitch Ratings raised its outlook on the second-biggest former Soviet Union economy to positive in October on optimism the government, formed in August, will usher in greater political stability. (Bloomberg)