By Jonathan Davies
The Ukraine parliament has voted to give ministers the power to suspend foreign debt repayments.
“In case of attacks on Ukraine by unscrupulous creditors, this moratorium will protect state assets and the state sector,” the prime minister Arseniy Yatsenyuk said.
Finance minister Natalie Jaraseko said the vote was “an important protection for citizens who are already shouldering a heavy burden due to the war in the east”.
It comes as the latest twist in a row over the $25 billion (£16bn) rescue package from the International Monetary Fund (IMF) and EU.
Ukraine claims its economy has been impacted further by economic sanctions imposed on Russia, which is it biggest trade partner.
Ms Jaraseko said: “Our government expects our international commercial creditors to negotiate respecting the principles of transparency, responsiveness and good faith.
“Today’s vote demonstrates the seriousness of our difficult financial position and the need to rapidly conclude a debt operation … I remain confident that such a solution can be found.
“Given our economic challenges and situation, our current debt levels are unsustainable and any deal with our international commercial creditors must include maturity extensions, coupon reductions and principal reductions. There is no alternative.”