Russia is defined as insolvent
: for the first time in a century and as a result of Western sanctions on Moscow, President Vladimir Putin's country is unable to meet its financial obligations and transfer the funds to Russian bondholders.
In the first, a 30-day extension that $ 100 million in bondholders granted to Russia expired and now the country is set in a state of insolvency even though it is financially able to pay.
The sanctions imposed on Russian banks and financial institutions by the European Union and the United States since the beginning of the invasion of Ukraine on February 24 caused a situation in which Moscow could not technically transfer the money to the debtors, after being removed from the international financial system.
Russia's defeat was welcomed by members of the G7 group of industrialized nations, who are currently gathering in the Bavarian mountains of Germany for a final day of talks that will end tomorrow.
Demonstrator arrested by police in St. Petersburg, Russia, Photo: API
"This morning's news of Russia's insolvency for the first time in more than a century shows how strong the US actions, along with its allies and partnerships, have been, as well as how dramatic the impact on Russia's economy has been," a U.S. diplomat was quoted as saying. Reuters.
The Kremlin blames the West for the situation and says the move was deliberately intended to put it in a state of insolvency while at the same time claiming that the country had met its obligations after transferring the required amount to a Russian financial institution (NSD) with headquarters in Moscow, used to pay Russian bondholders.
The last time Russia was insolvent was during the Bolshevik Revolution.
However, the financial entanglement is still likely to continue in international courts, with Moscow claiming that they have met their debts and debtors will say they have not received the funds.
This is another "environmental damage", an indirect consequence of the war which has entered its fifth month and whose effects are well felt outside the battle zone in the form of rising gas, fuel and electricity prices in Europe which are largely dependent on Russian energy.
Also, a threat of crisis in the food industry is hovering over the international economy which is not yet recovering from the plague of the corona which has been accompanying the markets for the past three years.
"We are analyzing the situation. Our position is known. Our reserves are illegally blocked, and all attempts to use these reserves will also be illegal," Kremlin spokesman Dmitry Peskov said in a statement.
"Russia has made the required currency payments in the currency to be repaid in May.
And the fact that they were blocked by Euroclear and did not reach the recipients is not our problem.
In this case, there is no reason to call this situation insolvent, "he explained.
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