Ukraine’s public debt increased by $1B in a month. The government is preparing to restructure a Chinese loan.

In May, Ukraine’s total public and state-guaranteed debt increased by $1B to $180.97B, reported the Ministry of Finance. Most of the debt is external, totaling $134.48B, which makes up 74.3% of the overall debt. Domestic debt stands at $46.48B. In April, the IMF predicted that Ukraine’s total public debt would reach 110% of the country’s GDP this year. Last year, public debt was 89.8% of GDP.

Additionally, Ukraine plans to restructure the loan taken by the State Food and Grain Corporation of Ukraine, obtained from the Export-Import Bank of China under a state guarantee in 2012, according to draft amendments to the 2025 state budget. Specifically, the government has asked the Verkhovna Rada for permission to temporarily suspend payments on this loan, which is due in 2030. This will enable negotiations with the Chinese bank for more favorable repayment terms. The suspension will last until an agreement is reached with the creditor.

Last year, the government employed a similar suspension mechanism to negotiate the restructuring of government Eurobonds, Ukrenergo Eurobonds, GDP warrants, and Cargill loans.