Eric LeCompte Comments on Ukraine's Debilitating Debt in Barron's

By Nadia Khan, Communications Associate

Eric LeCompte writes for Barron's on Ukraine's debilitating debts. Read the full article here. 

Ukraine’s Debts Will Be Debilitating, Unless the World Helps

By Eric LeCompte

The images of families fleeing and the decimation of Ukraine are heartbreaking. 

Not since World War II have we seen a humanitarian crisis in Europe on this scale. Unlike World War II, we are witnessing the human suffering in real time as it unfolds on screens and social media. While the United Nations reports around 750 civilians have been killed and injured, including children, they assert the numbers are likely much, much higher. 

Unfortunately, while there are critical things that must be done, our failure to implement full financial crisis solutions limits the scope of the financial crisis response for Ukraine.

Ukraine currently holds $94.7 billion in debt. Ukraine will fail to pay external debts while the humanitarian crisis rages on.

 

The G7 can lead the suspension of Ukraine debt payments. Governments around the world can offer debt relief and implement efforts to protect Ukraine from paying private creditor debt. While the Biden administration has been heroic in leading financial sanctions on Russia, a Biden executive order would help stop a major portion of the $28 billion of the overall private creditor debt payments that is registered under U.S. law. This action would follow precedent when George W. Bush halted private creditor and oil obligations for Iraq’s recovery.