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Ukraine said it needs an expansion of a bailout program thats keeping its economy afloat as bonds fell to a record and government forces continued to come under attack from pro-Russian separatists in the east.

Economy Minister Aivaras Abromavicius said yesterday its too early to say how much more aid Ukraine requires. The country may need to almost double its $17 billion emergency loan within weeks to avoid bankruptcy, the Financial Times reported, citing unidentified officials. Representatives from the International Monetary Fund arrived in Kiev this week to discuss further payments under the existing program and a possible expansion.

Concerns are growing that the government in Kiev will be unable to repay its debts as the months-long fighting in two breakaway regions takes its toll on Ukraines economy. The countrys credit-default swaps are the highest worldwide after Venezuela, data compiled by Bloomberg show.

The financing which Ukraine needs is so large, and the Western financing likely on offer or available of much smaller size, said Tim Ash, London-based chief emerging-market economist at Standard Bank Group Ltd.

The price of Ukraines dollar-denominated bonds maturing in July 2017 tumbled 6 cents to 67.3 cents on the dollar yesterday in Kiev, the lowest level on record. The yield surged to 27.582 percent, almost double the yield on bonds maturing in 2023.

German Finance Minister Wolfgang Schaeuble was said to have asked Russias Anton Siluanov to let Ukraine delay the repayment of $3 billion in bonds issued last year, according to the Financial Times, which reported that the IMF found a $15 billion shortfall in the countrys budget. Russia has the right to call an early repayment of the notes, due in December 2015, if Ukraines public debt tops 60 percent of economic output.

That ratio may jump to 70 percent by the end of the year, Moodys Investors Service said Oct. 30.

The new Ukrainian government of Premier Arseniy Yatsenyuk needs to adopt a 2015 budget and tax laws complying with IMF requirements to qualify for the next $2.8 billion disbursement of its bailout package. Ukraine needs the cash to repay debt, buy heating fuel for winter and stem the hryvnias slump.

The economy shrank 5.3 percent from a year earlier in the third quarter, more than the 5.1 percent preliminary estimate, according to the Kiev-based statistics office.

Yatsenyuk is scheduled to speak in parliament in the Ukrainian capital today as lawmakers consider the cabinets budget plans.

Read more:
Ukraine Seeks Bigger IMF Package as Bonds Slump to Record