There are no grounds for a real default by Russia, this situation is artificially created by the West, and if payments on Russian Eurobonds in foreign currency continue to be blocked, Moscow will pay in rubles, said Dmitry Peskov, press secretary of the President of the Russian Federation.
“For details, it is better to turn to the Central Bank, but once again, Russia has all the necessary resources to service its debts,” Peskov told reporters.
He noted that significant amounts of Russian reserves are blocked in foreign countries.
“If the blocking continues and these transfers for servicing debts are also blocked from the blocked amounts, they can be paid in rubles. If this is not possible, then theoretically, theoretically, of course, some kind of default situation can be organized, but this is a purely artificial situation, there are no grounds for a real default,” Peskov said.
The Russian Ministry of Finance announced earlier on Wednesday that for the first time it fulfilled its obligations in rubles on sovereign Eurobonds to foreign holders (for $649.2 million) due to the refusal of a foreign agent bank to execute orders in foreign currency.
Conversion into foreign currency will be possible no sooner than Russia will return access to frozen foreign currency accounts, follows from the statement of the ministry.
The Russian finance ministry said on Wednesday it had to pay roubles to holders of its dollar-denominated Eurobonds maturing in 2022 and 2042 as a foreign bank refused to process Russia’s order to pay $649.2 million to holders of its debt.
The finance ministry said the foreign bank, the name of which it has not disclosed, rejected Russia’s order to pay coupons on the two papers and also did not process the payment of the face value of the Eurobond maturing in 2022.
Russia may consider allowing foreign holders of its 2022 and 2042 Eurobonds to convert rouble payments into foreign currencies once Russia’s access to its forex accounts is restored, the finance ministry said.
Russia’s ability to fulfil its debt obligations is in focus after sweeping Western sanctions in response to what Russia calls “a special military operation” in Ukraine have frozen nearly a half of the country’s state reserves and limited Moscow’s access to global payment systems.
