Ukraine Stiffs China for Billions Owed

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Ukraine Stiffs China for Billions Owed

China paid Ukraine $3B two years ago for grain still not delivered, now demands refund. Another $3.6B that’s owed to China, will probably also default.

Eric Zuesse
Russia’s RIA Novosti News Agency reported, on January 17th, that China is demanding refund of $1.5 billion in cash and of an additional $1.5 billion in Chinese goods that were paid in advance by China (in 2013), for a 2012 Chinese order of grain from Ukraine, which goods still have not been supplied to China.

According to RIAN, “State Food and Grain Corporation of Ukraine (STATE FOOD) supplied grain in 2013, elsewhere, but not to China. The new Kiev authorities had an opportunity to fix the short-sighted actions ‘of the [previous] Yanukovych regime,’ and to present a positive economic image to the Chinese.” But it didn’t happen.

Furthermore: “Prior to the Presidency of Yanukovych [which started in 2010], China’s leadership had simply refused to do business with the pre-Yanukovych Administration’s Yulia Tymoshenko, and they planned to wait until Yanukovych became President. He then came, and since has been ousted, and yet still only $153 million of grain has been delivered.

(None of the $1.5B cash that China advanced to Ukraine to pay for growing and shipping grain has been returned to China, but only the $153M that had essentially been swapped: Chinese goods for Ukrainian grain.) This $153 million was approximately as much as the interest that would be due on China’s prepayment, and so Ukraine still owes China the full $3 billion ($1.5B in cash, + $1.5B that China supplied in goods).

The RIAN report goes on to quote Alex Luponosov, a Ukrainian authority on Ukraine’s banking system, who says, “Ukraine won’t be able to supply the grain to China, because we don’t have it.” The reason he gives is that “there is a big shortage of technicians: combiners, adjusters, mechanics, farm-machinery operators — all of them were taken by the army.”

Those men are being required to fight in Ukraine’s ‘ATO’ or ‘Anti Terrorist Operation,’ that’s occurring in Ukraine’s former Donbass region (the far-eastern tip of Ukraine), the place where the residents don’t accept the new Ukrainian Government’s legitimacy, and they are therefore being called ‘Terrorists’ by this new Government, which is thus bombing them, supposedly in order to convince them that this new Government’s authority over them is legitimate (even though the residents there never participated in its selection, and have been cut off even from Ukraine’s social-security payments)…..More Here

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Ukraine Stiffs China for Billions Owed