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Russia to wait until Ukraine forms the government to continue with bailout.

January 31, 2014

President Vladimir Putin , PM Dmitry Medvedev, and first deputy PM Igor Shuvalov suggested waiting until Ukraine forms a new government to continue fulfilling Russia's latest financial and energy obligations. Previously Russia agreed to grant Ukraine USD 15bn by pledging to buy out issues of sovereign Eurobonds, while also lowering the gas exports price to USD 268.5 per 1,000m3. The first issue of USD 3bn worth of bonds (now junk-rated at CCC+/Negative by S&P) were already acquired by tapping into Russia's National Welfare Fund . Russia's bail-out plan reversed the Ukrainian government's intention to sign an Assosiation Agreement with EU. Since then, two-months long fierce street protests that took the lives of six led to stepping down of PM Mykola Azarov. The prostest continue demanding the resignation of pro-Russian president Victor Yanukovych. During the EU-Russia summit in Brussels this week, Vladimir Putin pledged to continue the support program regardless of the outcome of the current Ukrainian political crisis. However, back in Russia , Medvedev and Shuvalov urged to put the program on hold until the new government is formed.

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Source: IntelliNews - Weekly Reports

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