Ukraine expects first tranche of $3 billion from IMF aid package

[TomClash]

Source: Reuters

(Reuters) - The International Monetary Fund and Ukraine are discussing disbursement of $3 billion in the first tranche of a $14-18 billion bailout package, Ukraine's finance minister said on Friday.

"They (the IMF) are ready today to talk about (disbursing) a first tranche of $3 billion, of which half will go to the National Bank and half to the state budget," the minister, Oleksander Shlapak, told journalists on the margins of a government meeting.


Read more: http://www.reuters.com/article/2014/03/28/ukraine-crisis-imf-tranche-idUSL5N0MP2R820140328

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Note how the IMF is moving at warp speed. Naomi Klein says hello.

[go west young man]

1. Complete breakdown of how the U.S. did it.

[Larry Ogg]

6. Thanks for posting this time line video of the Ukraine Crisis...

I have seen much of this information when it was originally coming out, good to see it all pieced together like this, it should make for a good presentation for people who are willing to look at more than one side of the story.

If this Ukraine nightmare was taking place under Gorge Bush DU would be ablaze with this information. Unfortunately, when Obama took over where Bush left off, there was no interruption in a US foreign policy of stirring up hornets nest by supporting blood cults of right wing extremist around the globe; no surprise there.

[arcane1]

8. Kicking to watch later

[alcibiades_mystery]

2. The IMF should just deposit the money directly into Deutsche Bank and Goldman's accounts

Why bother with the middle man?

[go west young man]

3. The middle man is necessary for appearances...

without the Ukrainian middlemen the IMF couldn't pull of the thievery. They are always necessary...until, of course, they are not.

[olddad56]

5. Why don't they just give the money directly to Putin. Once he takes over the Ukraine,

once he seizes that country, it will be his money.

[Larry Ogg]

10. Why don't you just completely close your eyes and ears...

to any source of information that isn't the parroting of western puppet propaganda.

Because discerning minds would hate for you to wake up some day and discover that there is actually a more truthful side of the story than the one you have grown accustom to listening too.

[dipsydoodle]

7. Wrong accounts.

If the amount causes a crossover in the of their debt :GDP ratio beyond 60% then the $3 billion will payable to Russia as it will put in default the $3 billion Russia bought in bonds last December.

See :

As CNBC has reported, some aid money is bound to go into Russia as a result of energy trade and other economic factors. But the situation is actually much more acute than just that: An existing agreement between the two countries makes an immediate, direct transfer from Ukraine to Russia legally enforceable.

As Western leaders prepare a bailout package for embattled Ukraine, they face a startling irony: Thanks to the almost bizarre structure of a bond deal between Ukraine and Russia , billions of those dollars are almost certain to go directly into the coffers of the Putin government.

In December, Russian President Vladimir Putin agreed to lend Ukraine $15 billion. Few details were released at the time, except that Ukraine would issue bonds and Russia would buy them in installments through 2014.

>

-Paragraph 3 (b) under Covenants:

(b) Debt Ratio
So long as the Notes remain outstanding the Issuer shall ensure that the volume of the total state debt and state guaranteed debt should not at any time exceed an amount equal to 60 percent of the annual nominal gross domestic product of Ukraine.

The implications of that clause are that the minute the West or the International Monetary Fund extend a large loan to Ukraine, that country will almost certainly have a debt-to-GDP that exceeds 60 percent, immediately putting the Russian loan into default. That gives Russia the right to demand immediate repayment. And because the bonds are governed by British courts-which, presumably, neither Ukraine nor Russian can manipulate-it would be extremely difficult for Ukraine to avoid making the payment, using its new bailout money.


http://finance.yahoo.com/news/3-billion-ukraine-straight-russia-172652361.html

[Larry Ogg]

9. They first have to chain small countries down with debts and interest that can never be repaid...

Last edited Fri Mar 28, 2014, 05:36 PM - Edit history (1)

Of course, all debts that can never be repaid require collateral in case of default, and collateral is always the countries resources.

Then comes the austerity programs which means, when the country can not repay the debt, which was the plan all along, i.e. default by design. So now the resources can begin to hemorrhage out of the country, just as planed, and sold on the capitalist free market, and a fraction of the fortune that is made, will be applied as payments on the growing debt that will never be paid off.

Of course, the majority of the profits will be deposited directly into the IMF, i.e. the Deutsche Bank, Goldman Sacks, the insanely rich etc. And the families who live in these countries, well they can just go fuck themselves, because the worlds financial criminals have a really great plan for us all, which is more austerity.

So now we can all sit around clapping our hands and praising Obama, (the son, the grandson, and a good friend of banksters everywhere), for helping to spread the best pretend democracy money can buy.

[seabeckind]

4. Time to sharpen our sabers

Can't let Russia get in the way of our bankers collecting a debt.

OTOH, this new money will pay off the bankers. So who is backing this refi?

Never mind. Dumb question.

[Xolodno]

11. So sad...

Putin taking Crimea and the west not recognizing the annexation makes it impossible for the Ukraine to join the EU and NATO.

Putin also set things up to where if the Ukraine did align west, the country would have to really pay the piper...hoping to make it unattractive to the west...as they would be paying Russia off.

Apparently he miscalculated just how fiendish capitalist bankers can be. As they are indeed willing to pay Putin off and will put Ukraine under so much debt, it will be a debtor prison for a couple of generations. And Putin will not want to absorb Ukraine as he will have to absorb its debt.

[go west young man]

12. Your missing the larger point.

Putin would have never gone for Crimea had the neocons and our government not orchestrated the coup. Putin in Crimea is a consequence of our actions aligned with far right extremists.

[Steviehh]

13. Ukraine aid

Glad to see Congress can get right on this.

Now how about Unemployment benefits for Americans?

[Xithras]

14. Of course they're moving quick. Can't give people time to reconsider.

The IMF aid is "loans". IMF loans come with strings attached that require economic modifications to the countries that accept them. If the countries fail to make the modifications (austerity, privatization, currency devaluation, acceptance of western banking practices, the recognition of "corporate and investor rights", etc), they are considered to be in default of the loan and the full amount must be repaid immediately...and most countries don't have billions laying around that can be used to pay off debt. More troubling, the IMF has the power to seize profits from international trade and commerce from a defaulted country in order to "repay the debt", so defaulting almost certainly means economic destruction for the nation.

By getting the loans pushed through and signed by a "legitimate" interim government, the IMF is successfully tying the hands of the elected governments that come later. The elected governments will still be liable for debt incurred by the interim government, and will be required to abide by the terms of the IMF loans that the interim government agreed to.

[jakeXT]

15. Ukraine Welcomes IMF Austerity Regime

Ukraine’s new leader Arseniy Yatsenyuk held firm to his promise this week that he will become the country’s worst-ever Prime Minister. On Thursday, he agreed to a minimum of $14 billion to as much as $18 billion in an International Monetary Fund package that requires massive reforms of Ukraine’s weak economy.

Ukraine’s economy is roughly 40% smaller than that of Greece, with a GDP of around $170 billion. The IMF admitted last summer that it had misjudged the effect of austerity on Greece, saying it had miscalculated the so-called “fiscal multiplier” and were too optimistic on growth.

Ukraine’s macroeconomic imbalances became unsustainable over the past year. The current account deficit is over 9% of GDP, worse than Greece’s 3.37%. Within the region, only smaller countries like Armenia and the countries that were once part of Yugoslavia are in worse shape.

Ukraine has significant external debt payments and limited access to international debt market. International reserves fell to a critically low level of two months of import in early 2014, or around $30 billion


http://www.forbes.com/sites/kenrapoza/2014/03/28/ukraine-welcomes-imf-austerity-regime/