In accordance with the law, the Ukrainian government will be able to refuse to pay Russia a $3 billion debt. The next payment on it is due in June 2015

Ukrainian President Petro Poroshenko signed a law allowing the country's government to declare a moratorium on the payment of external debts. The Verkhovna Rada website notes that the bill, adopted by parliament on May 19, 2015, was today returned to the Rada with the signature of the president. The law will come into force the next day after its publication in the official press.

Last week, the Verkhovna Rada quickly adopted a law developed by the government, according to which the Cabinet of Ministers is allowed to suspend payments on all or individual government external debts and state-guaranteed loans (except for two state-owned banks and the railway operator Ukrzaliznytsia).

The Ministry of Finance of Ukraine welcomed the adoption of the law, explaining that it will help “protect the interests of the Ukrainian people, and in the event of unfair actions of creditors in relation to Ukraine, protect the assets of the state and the public sector.”

In turn, the head of government Arseniy Yatsenyuk explained that the Cabinet of Ministers may announce a moratorium on debt payments if it is not possible to reach an agreement with creditors. The Prime Minister called on creditors to listen to proposals for debt restructuring on Ukraine’s terms and to help the Ukrainian state “not with words, but with dollars, or rather, billions of dollars.”

“We want to pay, but we want to pay on the terms on which the Ukrainian government and the Ukrainian state offer,” Yatsenyuk said.

Russian Finance Minister Anton Siluanov assessed the adoption by the Verkhovna Rada of the law, according to which the country's government received the right not to pay debts, as an actual declaration of default.

“We need to analyze the consequences of the adoption of this law; if we see violations of the obligations that Ukraine has given, we will seek a judicial mechanism to protect our interests so that they do not suffer,” Siluanov said.

Later, Russian President Vladimir Putin said that the actual announcement of the upcoming default by the Ukrainian authorities indicates a low level of their professionalism and responsibility.

The list of Ukraine’s obligations that may be subject to a moratorium also includes government bonds issued by Ukraine and purchased by Russia in 2013. These securities, worth a total of $3 billion, mature at the end of 2015. Until now, Ukraine has fulfilled its obligations to service the state debt to Russia under bonds worth $3 billion. The next payment in the amount of $75 million is due on June 20, 2015.

In April 2014, the international rating agency Standard & Poor's (S&P) stated that Ukraine's default was "virtually inevitable."

Poroshenko signed a law on a moratorium on the payment of Ukraine's debts