{"id":143067,"date":"2015-01-21T19:22:01","date_gmt":"2015-01-21T19:22:01","guid":{"rendered":"http:\/\/rinf.com\/alt-news\/?p=143067"},"modified":"2015-01-22T02:32:32","modified_gmt":"2015-01-22T02:32:32","slug":"ukraine-stiffs-china-billions-owes","status":"publish","type":"post","link":"http:\/\/rinf.com\/alt-news\/editorials\/ukraine-stiffs-china-billions-owes\/","title":{"rendered":"Ukraine Stiffs China for Billions Owed"},"content":{"rendered":"

China paid Ukraine $3B two years ago for grain still not delivered, now demands refund. Another $3.6B that\u2019s owed to China, will probably also default.<\/strong><\/p>\n

Eric Zuesse<\/p>\n

Russia\u2019s RIA Novosti News Agency reported<\/a>, 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.<\/p>\n

According to RIAN, \u201cState 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 \u2018of the [previous] Yanukovych regime,\u2019 and to present a positive economic image to the Chinese.\u201d But it didn\u2019t happen.<\/p>\n

Furthermore: \u201cPrior to the Presidency of Yanukovych [which started in 2010], China’s leadership had simply refused to do business with the pre-Yanukovych Administration\u2019s 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.\u201d (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<\/em> 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\u2019s prepayment, and so Ukraine still owes China the full $3 billion ($1.5B in cash, + $1.5B that China supplied in goods).<\/p>\n

The RIAN report goes on to quote Alex Luponosov, a Ukrainian authority on Ukraine\u2019s banking system, who says, \u201cUkraine won\u2019t be able to supply the grain to China, because we don\u2019t have it.\u201d The reason he gives is that \u201cthere is a big shortage of technicians: combiners, adjusters, mechanics, farm-machinery operators \u2013 all of them were taken by the army.\u201d Those men are being required to fight in Ukraine\u2019s \u2018ATO\u2019 or \u2018Anti Terrorist Operation,\u2019 that\u2019s occurring in Ukraine\u2019s former Donbass region (the far-eastern tip of Ukraine), the place where the residents don\u2019t accept the new Ukrainian Government\u2019s legitimacy, and they are therefore being called \u2018Terrorists\u2019 by this new Government, which is thus bombing<\/a> them, supposedly in order to convince them that this new Government\u2019s authority over them is legitimate (even though the residents<\/a> there never participated in its selection<\/a>, and have been cut off even from Ukraine\u2019s social-security payments).<\/p>\n

The Russian news report continues by quoting Luponosov again: \u201cIf the declaration of mobilization will take place in the planned figures, up to 100 thousand people in three stages, the sowing campaign cannot take place, either on the farms or at the grain traders.\u201d As part of Ukraine\u2019s military mobilization \u2013 the new phase of which which started on January 20 \u2013 military offices take first the rural male population of the country, and farm-production must therefore suffer.<\/p>\n

Luponosov was quoted: \u201cNow try to tell Parliament to amend the war-legislation so that these people won\u2019t be taken from their villages. No one will deny the military. Parliament thus cannot do anything [to fulfill on Ukraine\u2019s grain-contract with China].\u201d<\/p>\n

The RIAN report says that, \u201cChina is angry,\u201d and it closes: \u201cBy the way, in addition to China\u2019s $3B loan that\u2019s to be repaid with grain [which cannot be supplied], Ukraine also received from China a $3.6 billion loan to pay for the gasification of coal, by Ukraine\u2019s gas company, Naftogaz, which the Ukrainian Government has guaranteed up to 2.3 billion dollars. Information on the implementation of the coal-gasification project has not been made available, but there seems to be a high probability that this matter too will be decided in a court. If China decides to call in that loan, then the result will be the bankruptcy of either Naftogaz, or the Ukrainian Government.\u201d<\/p>\n

On January 9th, Ukraine\u2019s Prime Minister, Arseniy Yatsenyuk, reassured the IMF, EU, and other investors of all funds<\/a> that are being loaned to Ukraine, that Ukraine is doing everything possible to fulfill on its financial obligations to all investors:<\/p>\n

“I would also like to note that the money that we get in the framework of international financial assistance, does not go to finance the state budget deficit, it does not go to the payment of pensions, it does not go to the payment of wages. All of this is happening in the first place, solely to perform our external obligations.\u201d On 1 May 2014, the IMF (whose money comes from taxpayers in U.S. and the EU, not from the aristocrats whose investments the IMF protects and whom the IMF actually serves) had stated that Ukraine\u2019s first obligation, without which the IMF would lend no more money, is to win the war against Donbass<\/a>. Yatsenyuk, thus, is here reassuring the IMF, and other investors in Ukraine, that their money will not go to pay for anything but winning this war.<\/p>\n

The IMF, and other lenders, require Ukraine to win this war, because, if the Ukrainian Government doesn\u2019t win, then the natural gas<\/a> and other assets that are in the ground in that region will not become available to be sold off by the Ukrainian Government in order to pay-off those investors; instead, the residents there (the people whom the Ukrainian Government is now trying to eliminate<\/a>) will control those assets, as being assets of a separate state \u2013 one which has not borrowed from these investors. The IMF wants the assets that are in the ground, not the people who are living on it<\/a>. That is why it demands victory (elimination<\/a> of the people<\/a> in Donbass<\/a>) \u2013 or else Ukraine will promptly go bankrupt<\/a>. (And, perhaps, so too will some of those investors<\/a>.)<\/p>\n

\u2013\u2013\u2013\u2013\u2013<\/p>\n

Investigative historian Eric Zuesse is the author, most recently, of They\u2019re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010<\/em><\/a>,<\/em> and of \u00a0CHRIST\u2019S VENTRILOQUISTS: The Event that Created Christianity<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

China paid Ukraine $3B two years ago for grain still not delivered, now demands refund. Another $3.6B that\u2019s owed to China, will probably also default. Eric Zuesse Russia\u2019s 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 […]<\/p>\n","protected":false},"author":1254,"featured_media":142981,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[461,1622],"tags":[530,115,30,32,96,535,59,77,526,524,92,523,49,531,76,40],"class_list":{"0":"post-143067","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-editorials","8":"category-featured","9":"tag-banks","10":"tag-barack-obama","11":"tag-big-brother","12":"tag-cia","13":"tag-cover-up","14":"tag-global-news","15":"tag-military","16":"tag-oil","17":"tag-propaganda","18":"tag-russia","19":"tag-terrorism","20":"tag-ukraine","21":"tag-usa-news","22":"tag-wall-street","23":"tag-warfare","24":"tag-white-house"},"_links":{"self":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts\/143067","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/users\/1254"}],"replies":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/comments?post=143067"}],"version-history":[{"count":0,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/posts\/143067\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/media\/142981"}],"wp:attachment":[{"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/media?parent=143067"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/categories?post=143067"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/rinf.com\/alt-news\/wp-json\/wp\/v2\/tags?post=143067"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}