News / Economy

    Ukraine Looks to China for Money as Debt Crunch Looms

    Protesters cover an entrance to the Cabinet of Ministers with a huge EU flag in Kyiv, Ukraine, Dec. 2, 2013.
    Protesters cover an entrance to the Cabinet of Ministers with a huge EU flag in Kyiv, Ukraine, Dec. 2, 2013.
    Reuters
    Ukrainian President Viktor Yanukovich will head to China on Tuesday looking for loans and investment, despite the massive protests unleashed by his decision not to sign a trade pact with the European Union.
     
    Protesters blockaded the main government building in Kyiv on Monday and brought traffic to a halt, seeking to force Yanukovich from office, after hundreds of thousands demonstrated on Sunday against his decision to turn away from the EU towards Russia. Ukraine's currency and bonds came under pressure, along with share prices.
     
    But the tug of war between Brussels and Moscow for influence in Ukraine has so far done little to alleviate its looming debt crisis, and Yanukovich confirmed on state television on Monday that the visit would go ahead.
     
    “Yanukovich is trying to show that the European Union and Russia are not the only possible partners for Ukraine,” said Volodymyr Fesenko of Ukraine's Penta think-tank.
     
    However, he said Beijing may now demand assurances over Ukraine's political and economic stability, adding: “Ukraine is unlikely to secure direct financial aid [from China].”
     
    Beijing has already provided the former Soviet republic with loans worth $10 billion, but the government must find more than $17 billion in 2014 to meet gas bills and debt repayments.
     
    Including the private sector, Ukraine must make debt repayments of more than $60 billion next year, equivalent to a third of its gross domestic product.
     
    Opposition leaders called on Sunday for Yanukovich and his government to resign. A pro-Europe rally of about 350,000 people, marred by clashes between protesters and riot police,  was the biggest protest in the capital Kiev since the “Orange Revolution” of nine years ago.
     
    "Bad time to go"
     
    “It is a very bad time to go abroad. The president's absence may make talks with the opposition much more difficult,” said another Ukrainian political analyst, Gleb Vyshlinsky.
     
    Russia wants to draw Ukraine into a Moscow-led customs union and prevent it drawing closer to the EU, a move that would signal a historic shift towards the West and away from Kyiv's former Soviet masters in Moscow.
     
    Ukrainian Prime Minister Mykola Azarov, who backs closer economic ties with Russia, said at least 20 economic and trade agreements should be signed during the visit to China, including a treaty on friendship and cooperation.
     
    Ukraine had a $15-billion standby agreement with the International Monetary Fund, but this was frozen in 2011 over Kiev's refusal to end subsidies and raise household gas and heating prices.
     
    During a visit to Kyiv last month, the IMF once more urged Ukraine to raise gas prices for domestic consumers and introduce a flexible exchange rate for the hryvnia currency, steps that the government has rejected.
     
    A high-ranking Ukrainian government delegation visited China in September, when China's Export-Import Bank provisionally offered a $3 billion loan to help restore Ukraine's irrigation system.
     
    The loan has to be repaid over 15 years. Agriculture Minister Mykola Prysyazhnyuk said the loan would be used to install and repair irrigation systems in southern Ukraine, with the aim of increasing grain output by 12 million tons, or around 50 percent.
     
    Last year, China loaned Ukraine $3 billion for the agriculture sector and $3.7 for projects in the energy sector. As part of the deal, Ukraine exports around 4 million tons a year of maize to China.

    You May Like

    Hope Remains for Rio Olympic Games, Despite Woes

    Facing a host of problems, Rio prepares for holding the games but experts say some risks, like Zika, may not be as grave as initially thought

    IS Use of Social Media to Recruit, Radicalize Still a Top Threat to US

    Despite military gains against IS in Iraq and Syria, their internet propaganda still commands an audience; US officials see 'the most complex challenge that the federal government and industry face'

    ‘Time Is Now’ to Save Africa’s Animals From Poachers, Activist Says

    During Zimbabwe visit, African Wildlife Foundation President Kaddu Sebunya says poaching hurts Africa as slave trade once did

    This forum has been closed.
    Comment Sorting
    Comments
         
    by: Jonathan huang from: Canada
    December 03, 2013 1:12 PM
    Cooperate with China is better for Ukraine than with either EU or Moscow.
    We Chinese like Ukraine.

    by: 爱你中国
    December 02, 2013 2:53 PM
    "Last year, China loaned Ukraine $3 billion for the agriculture sector and $3.7 for projects in the energy sector", I just wonder what 3.7$ can do in the energy sector?
    In Response

    by: Jean-Claude Meslin from: Brignogan-Plages
    December 02, 2013 4:33 PM
    It seems to me that the ukraine 's troubles are tied to something much bigger than an association with Russia or United Europe. Every intelligent person know that E-U which go from Tahiti to Island Georgia etc. is a big mess which will never be credible. Its funding states are already sick of it. In 1970, it was written Europe will be Americanized or will never be. So seeing Ukraine united to E-U and Russia will be a tragedy for some living in Washington and New-York...A dirty chess game is still going on.

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Ivorian Chocolate Makers Promote Locally-made Chocolatei
    X
    July 29, 2016 4:02 PM
    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Ivorian Chocolate Makers Promote Locally-made Chocolate

    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Tesla Opens Battery-Producing Gigafactory

    Two years after starting to produce electric cars, U.S. car maker Tesla Motors has opened the first part of its huge battery manufacturing plant, which will eventually cover more than a square kilometer. Situated close to Reno, Nevada, the so-called Gigafactory will eventually produce more lithium-ion batteries than were made worldwide in 2013. VOA's George Putic reports.
    Video

    Video Polio-affected Afghan Student Fulfilling Her Dreams in America

    Afghanistan is one of only two countries in the world where children still get infected by polio. The other is Pakistan. Mahbooba Akhtarzada who is from Afghanistan, was disabled by polio, but has managed to overcome the obstacles caused by this crippling disease. VOA's Zheela Nasari caught up with Akhtarzada and brings us this report narrated by Bronwyn Benito.
    Video

    Video Hillary Clinton Promises to Build a 'Better Tomorrow'

    Democratic presidential candidate Hillary Clinton urged voters Thursday not to give in to the politics of fear. She vowed to unite the country and move it forward if elected in November. Clinton formally accepted the Democratic Party's nomination at its national convention in Philadelphia. VOA national correspondent Jim Malone has more.
    Video

    Video Trump Tones Down Praise for Russia

    Republican presidential candidate Donald Trump is toning down his compliments for Russia and Vladimir Putin as such rhetoric got him in trouble recently. After calling on Russia to find 30.000 missing emails from rival Hillary Clinton, Trump told reporters he doesn't know Putin and never called him a great leader, just one who's better than President Barack Obama. Putin has welcomed Trump's overtures, but, as Zlatica Hoke reports, ordinary Russians say they are not putting much faith in Trump.
    Video

    Video Uganda Unveils its First Solar-powered Bus

    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Silicon Valley: More Than A Place, It's a Culture

    Silicon Valley is a technology powerhouse and a place that companies such as Google, Facebook and Apple call home. It is a region in northern California that stretches from San Francisco to San Jose. But, more than that, it's known for its startup culture. VOA's Elizabeth Lee went inside one company to find out what it's like to work in a startup.
    Video

    Video Immigrant Delegate Marvels at Democratic Process

    It’s been a bitter and divisive election season – but first time Indian-American delegate Dr. Shashi Gupta headed to the Democratic National Convention with a sense of hope. VOA’s Katherine Gypson followed this immigrant with the love of U.S. politics all the way to Philadelphia.
    Video

    Video Dutch Entrepreneurs Turn Rainwater Into Beer

    June has been recorded as one of the wettest months in more than a century in many parts of Europe. To a group of entrepreneurs in Amsterdam the rain came as a blessing, as they used the extra water to brew beer. Serginho Roosblad has more to the story.
    Video

    Video Commerce Thrives on US-Mexico Border

    At the Democratic Convention in Philadelphia this week, the party’s presumptive presidential nominee, Hillary Clinton, is expected to attack proposals made by her opponent, Republican presidential nominee Donald Trump, to build a wall along the U.S.-Mexico border. Last Friday, President Barack Obama hosted his Mexican counterpart, President Enrique Peña Nieto, to underscore the good relations between the two countries. VOA’s Greg Flakus reports from Tucson.
    Video

    Video Film Helps Save Ethiopian Children Thought to be Cursed

    'Omo Child' looks at effort of African man to stop killings of ‘mingi’ children
    Video

    Video London’s Financial Crown at Risk as Rivals Eye Brexit Opportunities

    By most measures, London rivals New York as the only true global financial center. But Britain’s vote to leave the European Union – so-called ‘Brexit’ – means the city could lose its right to sell services tariff-free across the bloc, risking its position as Europe’s financial headquarters. Already some banks have said they may shift operations to the mainland. Henry Ridgwell reports from London.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.8998
    JPY
    USD
    103.32
    GBP
    USD
    0.7594
    CAD
    USD
    1.3176
    INR
    USD
    66.954

    Rates may not be current.