Politics

Russia says it will pay foreign debt in rubles after US ban

Russia says it is going to pay dollar-denominated international debt in rubles, a transfer this is prone to be noticed by means of international traders as a default.

The U.S. Treasury Department led by means of Janet Yellen allowed a license to run out Wednesday that authorised Russia to stay paying its debtholders via American banks. The license carried out to American traders and global traders who’ve dollar-denominated debt or bonds.

The Russian Finance Ministry stated it is going to pay in rubles and be offering “the opportunity for subsequent conversion into the original currency.” The ministry didn’t give a timeframe for that to happen.

Russia has not defaulted on its international debts since the 1917 Bolshevik Revolution, when the Russian Empire collapsed and the Soviet Union was created. Russia defaulted on its domestic debts in the late 1990s during the Asian financial crisis but was able to recover from that default with the help of international aid.

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“The current situation has nothing whatsoever in common with the situation in 1998, when Russia did not have enough means to cover its debts,” Finance Minister Anton Siluanov stated in a remark.

“Now there is money and there is also the readiness to pay. This situation, artificially created by an unfriendly country, will not have any effect on Russians’ quality of life.”

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