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The Russian authorities will go to court if Western countries default on Russia due to the lack of payments to Eurobonds in foreign currency. Finance Minister Anton Siluanov stated this in an interview with Izvestia.
According to him, Russia has done “everything possible” to pay off Eurobonds in the currencies in which the borrowings were made (primarily dollars) under the sanctions.
What are we facing? The foreign exchange accounts of the Ministry of Finance were frozen, as were the gold and foreign exchange reserves of the Central Bank. Nevertheless, until the last moment, even in these conditions, we carried out our settlements in dollars for our obligations, obtaining licenses, permissions to use our foreign currency.
However, last week the US authorities blocked regular payments in dollars, and Russia paid off its Eurobonds in rubles for the first time.
Will they be able to convert ruble funds into foreign currency? They will, but our position is that this can be done after the unfreezing of Russia’s foreign currency accounts is ensured. If an economic and financial war is waged against our country, we are forced to react, nevertheless fulfilling all our obligations
According to Siluanov, Western countries are trying to damage Russia’s image, “and a default is a blow to the country’s image as a reliable borrower.”
Of course, we will sue, because we have taken all the necessary steps to ensure that investors receive their payments. We will present in court our payment slips proving our efforts to pay [по евробондам] both in foreign currency and in rubles. It will not be an easy process.
Siluanov did not specify which judicial structures the Russian authorities would apply to.
In mid-March, Fitch, one of the three international rating agencies, warnedwhich will regard Russia’s payments on Eurobonds in rubles as a sovereign default.
At that time, the Russian Federation was still paying for Eurobonds in dollars, but in early April, the US authorities blocked such an opportunity. White House declaredthat this was done as part of increased pressure on Russia to force Moscow to choose between default and depletion of its dollar reserves.
April 9 international rating agency S&P downgraded long-term credit rating of Russia in foreign currency up to SD, which means default on some obligations.