Trump: “We Will Not Give Weapons to Ukraine Unless it Negotiates”

Private asset managers led by global giant Blackrock have demanded that Ukraine repay the debt owed to them with a maturity date of August 1. This is $20 billion

Days before the crucial debate between Democratic President Joe Biden and his Republican rival Donald Trump, scheduled for Thursday, June 27, a peace plan for Ukraine presented to Trump by a group of his political advisers was unveiled.

A Reuters news agency exclusive says that “some of Donald Trump’s key advisers have presented the former US president with a plan to end the war in Ukraine if he wins the presidential election.” Essentially, the plan involves “telling Kiev that it will continue to receive US aid only if it begins peace talks with Moscow.”

At the same time, the United States will expect Russia’s constructive participation in peace talks with Ukraine. “If Moscow refused to negotiate, it would lead to more American support for Ukraine,” said one of Trump’s security advisers, retired Geneal Keith Kellogg.

Financial pressure on the Kiev government is also growing. After nearly two and a half years of armed conflict, major private asset managers have demanded that Ukraine repay debts owed to them, which are due on August 1.

In 2022, a pool of investment funds decided on a two-year moratorium on Ukraine’s debt to them totaling about $20 billion. Just over a month before the deadline, Kiev asked for “an extension of maturities, as well as a 60% debt reduction.” Some of the creditors, led by global giant Blackrock, were ready, through clenched teeth, to consider Ukraine’s request and “accept a huge loss of 10-12 billion dollars.” Another group of creditors, including other international industry giants, Amundi, PIMCO, and Crédit Agricole, said they disagreed. Negotiations with the Kiev government, held behind closed doors in recent weeks, have yielded no tangible results.

The 20% debt reduction proposal put forward by the creditors was deemed “insufficient” by Ukraine’s Finance Ministry, which also requested that “existing bonds be replaced with new bonds maturing no later than 2040, with interest rates no higher than 1% until 2027, and then gradually increasing thereafter.”

International observers say both private creditors and institutions, from the International Monetary Fund to the European Union to the United States, are concerned about the extent of corruption in Ukraine. This prevents effective financial aid to the Kiev government, which is accused of stealing and transferring much Western funding to tax havens. As a consequence, less than half, or 31 billion, of the more than 77 billion euros allocated by the EU since the beginning of the conflict has actually been spent. IMF support programs are also closely linked to reforms in the tax sector and the fight against rampant corruption: so far, the IMF has disbursed $5.4 billion of the $15 billion envisioned in the four-year plan.