By Michael Pröbsting, Revolutionary Communist International Tendency (RCIT), 21 May 2024, www.thecommunists.net

According to a recently published report by the Wall Street Journal (WSJ), “a group of foreign bondholders (…) plans to press Ukraine to start paying interest on its debt again as soon as next year.” This group, which includes financial sharks like BlackRock and Pimco, holds around a fifth of Ukraine’s $20 billion of outstanding Eurobonds. [1]

At the beginning of the war in spring 2022, Western financial capitalists agreed to a two-year debt pause, since “many thought the war would be over by now.” But “now, their patience is starting to run out.”

The foreign bondholders offer the Ukraine a deal in which it would resume payments in exchange for forgiveness of a part of the country’s outstanding debt. In this way, the financial sharks “hope to take in as much as $500 million in annual interest payments.“ If they don’t reach a deal, Ukraine could default in August. As the WSJ comments, “if a deal is reached, it could be financially rewarding for investors who bought Ukraine’s bonds at bargain prices.”

How on earth should the Ukraine pay such huge sums? The country has been plundered since the restoration of capitalism in 1991 by domestic oligarchs as well as by Western and Russian companies. ^[2] And after Putin started to invade the country in February 2022, tens of thousands of people have been killed, millions displaced, and houses and infrastructure destroyed.

The WSJ notes that “the U.S. and its allies are concerned that taxpayers’ money will wind up in bondholders’ hands if Ukraine resumes any type of debt service.” In other words, they hope that interest rates are not paid from Western aid (mostly financed by Western working-class taxes) but by taxes from the already impoverished workers and peasants in the Ukraine. It is unclear if this can be realized or if both the working people in Western countries as well as the Ukraine shall pay for the dividends of the financial sharks. In any case, the monopoly capitalists once more try to enrich themselves at the cost of the popular masses.

All this demonstrates the cynical and greedy nature of American and European imperialism. Sure, in public, Western leaders cry crocodile tears about the tragic fate of the Ukrainian people. But in reality, they consider the country – a capitalist semi-colonial country – as a military bulwark against Russian imperialism as well as a gold mine to make big bucks. As the famous saying goes, war is a profitable business!

The only solution is to fight for a Ukraine which is free from foreign occupation as well as from imperialist super-exploitation, i.e. for an independent and socialist Ukraine! This is why the RCIT and its comrades in Spalakh (our section in the Ukraine) advocate the defence of the country against Putin’s invasion without becoming a subordinated proxy of Western imperialism. For this it is urgent to get rid of the corrupted pro-NATO regime of Zelensky and to replace it with a workers government.