Published by Global Banking & Finance Review®
Posted on May 16, 2025
3 min readLast updated: January 23, 2026
Add as preferred source on GoogleUkraine is taking its time to restructure $3.2 billion GDP-linked debt, preparing investors for possible default. Meetings in London highlight strategic delay.
By Libby George and Marc Jones
LONDON (Reuters) -Ukraine's chief debt negotiator told investors in London this week that Kyiv is in no hurry to restructure its GDP-linked debt, three sources told Reuters, effectively preparing them for possible default on a payment due within weeks.
The meetings in London between investors and Ukraine's debt chief, Yuriy Butsa, took place as senior Russian and Ukrainian negotiators met in Turkey for the first direct talks over the war in more than three years.
Ukraine is supposed to make a more than half a billion dollar payment on the so-called 'GDP warrants' on which it owes $3.2 billion by early June after restructuring talks with a core group of their holders broke down last month.
According to sources, Butsa told investors that Ukraine would take its time to get the right deal rather than rushing to strike an agreement before the upcoming deadline.
"They've made it clear there is a moratorium in place and ... there is no cross default to the bonds," one investor told Reuters.
There was no dedicated meeting with the warrantholder group, one source said.
Ukraine's debt office told Reuters it had been, "actively engaging with stakeholders and gathering market feedback to identify the best path forward for the treatment of the warrants," as part of efforts to make its debt sustainable.
The sources said Butsa underlined that a near-term solution to rework the warrants is a priority, but that they were not afraid to miss the payment.
The message is in line with what Kyiv has told the market for weeks. Ukraine's bonds traded mixed and warrants flat on Friday with earlier gains fuelled by optimism around the talks in Istanbul fading.
Ukraine threw in the GDP warrants - fixed income securities linked to economic growth - to sweeten its 2015 debt restructuring following Russia's annexation of Crimea.
But their complex structure meant they were not part of last year's broader $20 billion restructuring that became necessary following Moscow's full-scale invasion in 2022.
Ukrainian officials have said the near-30% collapse in its economy after Russia's 2022 invasion means that data showing it clawing back from that brink - rather than resounding economic strength - can now trigger the payments.
Finance minister Serhii Marchenko described them last month as being "designed for a world that no longer exists".
The warrantholder committee, which sources said is led by prominent hedge funds, has said a full restructuring of the warrants is "neither appropriate nor necessary" given the previous concessions made.
(Reporting By Libby George and Marc JonesEditing by Nick Zieminski, Karin Strohecker and William Maclean)
The article discusses Ukraine's approach to restructuring its $3.2 billion GDP-linked debt and potential default.
Ukraine wants to secure a strategic deal and is not rushing despite the upcoming payment deadline.
GDP warrants are fixed income securities linked to economic growth, used by Ukraine to sweeten its 2015 debt restructuring.
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