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Russia defaulted for the first time since 1918

27 June 2022 06:10 (UTC +04:00)

The Russian authorities defaulted on external debt obligations for the first time in more than a century, since 1918, APA reports citing Bloomberg.

This was the result of tightening Western sanctions.

Over the past few months, Moscow has been finding ways to circumvent restrictions imposed by the West that impede the fulfillment of external debt obligations, but by the end of the day on June 26, the grace period for paying about $ 100 million in overdue payments on Russian government bonds officially expired, the agency notes. The main payment period ended on May 27.

Formally, this is considered the onset of a default event. However, Bloomberg points out that for the Russian authorities “the default is mostly symbolic and of minor importance.”

The Ministry of Finance of the Russian Federation has previously repeatedly stressed that Russia is not going to default, despite all attempts by Western states to deprive Moscow of the actual ability to make payments on external public debt.

The department explained that the default is the lack of payment by the debtor, however Russia does not refuse to fulfill its obligations on government securities and takes all possible actions to bring funds to investors in full.