The Russia assured on Thursday that he had paid a first installment of interest linked to bonds, immediately removing the possibility of a default, while his assets abroad are frozen by Western sanctions.
“The payment order on the payment of bond interest (…) with a total value of 117.2 million dollars (…) has been executed,” the Russian Finance Ministry said in a statement. The ministry says it sent its funds to a “foreign bank” on March 14.
First installment in a long series
Moscow had until March 16 to pay these 117 million dollars, the first installment of a series of others expected in March-April. In retaliation for the Russian military intervention in Ukrainethe part of Russian reserves held abroad, regarding 300 billion dollars, is frozen under Western sanctions.
These sanctions raise fears that Moscow no longer able to repay, and therefore threatened with default. Western sanctions crippled part of the country’s banking and financial system and caused a collapse of the rouble. A payment default cuts a state off from the financial markets and jeopardizes its return for years.
