Medvedev: Ukraine owes $16 billion to Russia

Ukraine's debt to Russia stands at $16 billion, Russian Prime Minister Dmitry Medvedev told President Vladimir Putin at a session of the country's Security Council on Friday.

Ukraine's debt to Russia stands at $16 billion, Russian Prime Minister Dmitry Medvedev told President Vladimir Putin at a session of the country's Security Council on Friday.

"Ukraine has quite a significant debt to the Russian Federation, both state and corporate," he said.

"In my opinion, we cannot afford to lose this money since our budget is experiencing certain difficulties as well," the prime minister said.

"This figure includes the $3 billion loan that we granted to them recently by purchasing their Eurobonds in accordance with our agreements, as well as the accumulated debt to Gazprom of approximately $2 billion. It means that the overall volume of their debt becomes quite significant," he said.

"We gave them this discount on energy sources as soon as [the treaty] was signed in 2010. But we did this up front, bearing in mind the fact that we would have to begin prolonging the fleet's presence starting from 2017. It was a kind of advance payment on our part," Putin said.

Medvedev, for his part, confirmed that it "was effectively an advance payment taking our special agreements valid at that time into consideration."

"In principle, we could have refused to pay this money, but we paid them since it was in the terms of the treaty, but, as a matter of fact, by doing so we helped the Ukrainian state. But this advance payment should now be returned due to the changed circumstances," the prime minister said.

Putin agreed with Medvedev, saying that "indeed, we have such grounds."

The president, however, proposed "discussing and analyzing this issue without any haste" together with the Foreign Ministry and then present appropriate proposals together with the government.

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