The Government of Ukraine plans to restructure the remaining debt of $1.5 billion owed to China’s Export-Import Bank, which was borrowed in 2012 by the State Food and Grain Corporation of Ukraine (SFGCU) under state guarantees. This initiative is outlined in the proposed amendments to the 2025 state budget (draft law No. 13439), reports Baltimore Chronicle with reference to the document.
According to the information provided, in July 2024, the People’s Republic of China classified this debt as official bilateral state credit. As a result, the Ukrainian side began negotiations with the creditor to revise the terms of repayment. In December 2024, representatives of China’s Eximbank confirmed by email their readiness to discuss the restructuring of payments, noting that the process may be lengthy.
Taking into account that the talks with the Chinese side are being conducted under conditions equivalent to those agreed upon with other official creditors of Ukraine, the government proposes to impose a temporary moratorium on payments until the negotiations are concluded. It is planned to suspend payments under the state guarantees related to the debt obligations of SFGCU until a new agreement is reached or the terms of the existing debt are amended.
The original credit agreement was signed between the governments of Ukraine and China in June 2012. The total credit line amounted to $3 billion and was intended for the supply of Ukrainian grain to China and the purchase of Chinese agricultural equipment. In 2013, China’s Eximbank issued a $1.5 billion loan to SFGCU under Ukrainian government guarantees for a period of 15 years.
According to the terms of the agreement, Ukraine committed to supply 5 million tons of grain annually to China. However, only about 6 million tons have been delivered in total since the agreement was signed. Due to non-compliance with the terms of the contract, China filed a claim with the London International Arbitration.
As of early 2022, the outstanding loan balance amounted to $900 million.
Earlier we wrote that China retains advantage in critical materials sector.