White House said the country failed to pay interest on foreign debt that was due on Sunday (26.jun)
The Kremlin on Monday (June 27, 2022) denied allegations that it had defaulted on its foreign debt for the first time since 1917. The country says the money was sent, but not received by the bondholders.
On Sunday (June 26, 2022) the country missed the deadline to fulfill a 30-day grace period in interest of US$ 100 million in 2 Eurobonds due on May 27, according to the Bloomberg. White House officials attributed the default economic sanctions applied to the country.
The Russian Ministry of Finance, however, says that has fulfilled its obligations and made payments to its NSD (National Settlement Deposit). Kremlin spokesman Dmitry Peskov said the country made payments on the bonds due in May but were blocked by Euroclear because of Western sanctions.
“Declarations of default are absolutely unjustified”said Peskov. “The fact that Euroclear withheld this money and did not bring it to the recipients is not our problem. There is absolutely no reason to call such a situation a default.”
According to Reuters, Thai bondholders have not yet received interest payments.
Since the invasion of Ukraine, which began on February 24, the country has struggled to maintain payments on up to $40 billion in bonds. The Kremlin says there is no reason not to pay the debt, but is unable to send the money because of sanctions. The government accuses the West of trying to lead the country into default.
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