Russia ordered the payment of two U.S. dollar bond coupons due on Wednesday, but it is up to western states, primarily the United States, to withdraw the funds from the country’s frozen foreign currency accounts and pay bondholders, it said. said Russian Finance Minister Anton Siluanov.
“Whether or not we can meet our foreign currency obligations is not up to us, we have the money, we have made the payment, now the ball is in America’s court“, the official said in an interview with RT Arabic. He added that Washington should clarify whether it is possible to make payments from Russia’s foreign currency accounts.
Russia must pay $117.2 million on two issues of its sovereign Eurobonds on March 16. The Ministry of Finance announced on Monday that it had sent an order to transfer the payment to the international depository and clearing system Euroclear. The custodian will then transfer the money to bondholders. The payment order is given in US dollars, but in order for bondholders to receive the money, it must be withdrawn from frozen Russian currency accounts. But that could be tricky.
Nearly half of Russia’s reserves (around $300 billion) and foreign currency accounts of the Russian Central Bank (Bank of Russia) are frozen due to sanctions following the launch of the Russian military operation in Ukraine last month. last.
The restrictions have not included formal bans on operations servicing Russia’s foreign debt, but foreign banks can refuse to make payments on them, fearing retaliatory US sanctions. However, according to analysts, if the order in foreign currency is not executed, the amount due will be transferred to the accounts of bondholders in rubles at the exchange rate of the Central Bank of Russia on the day of payment.
Despite sanctions that prevent Russia from fulfilling its obligations, the country intends to do so, according to Siluanov, who insists that Russia has all the necessary funds. As the official mentioned earlier, there is no real economic reason for Russia to default on its debt.
Experts also say that given Russia’s GDP ($1.65 trillion) to external debt ($478.2 billion) ratio of no more than 25%, the country is financially stable, which which confirms Siluanov’s earlier statement that the West is trying to drag Russia into a “artificial defect.”
West accused of engineering ‘artificial flaw’ in Russia
Russia also has special drawing rights (SDRs) at the International Monetary Fund, which are not subject to sanctions, and analysts say they could also be used to pay off its national debt if other measures fail.
For more stories on economics and finance, visit RT’s business section
You can share this story on social media: