Business owes nearly USD 2 bn to the state under state-guaranteed loans

Photo: Flickr

The volume of overdue debts of companies on the loans attracted under the state guarantees has amounted to UAH 1.958 bn, according to the report published by the Ministry of Finance. Over the year the debt decreased by a little over USD 50 mn. However, in the beginning of 2014 the debt of over USD 2 bn was the equivalent of UAH 16 bn, while now, having remained at nearly the same level in dollars, the debt in hryvnia exceeded UAH 48.5 bn, taking into account the current exchange rate of UAH 24.8/USD.

While the debt of the companies is increasing, the government has to fulfill its obligations under the guarantees and pay the bills. Last year the government paid over UAH 1.5 bn from the national budget, while a year earlier the amount was around UAH 600 mn. The difficulty for the state is that the majority of companies, who were granted loans under state guarantees in the past, are either bankrupt or have been liquidated. In fact, some of the cases have been dragging on since the end of the 1990s.

As Capital wrote earlier, the government has tried on more than one occasion to return the debts. Ministry of Finance involved tax bodies in this issue having convinced the Cabinet to make the debt under state guarantees equal to the tax debt. Failing this initiative the Ministry of Finance tried to sell bad debts through exchanges for over three years. However, no buyers were found for the bad liabilities.