At the last stroke of midnight struck by the great Kremlin clock on Sunday, Russia found itself in default on its international debt. It failed to pay 29 million euros and 71 million dollars in interest to its investors. This settlement was due on May 27, but Moscow had benefited from the 30-day grace period provided for in the contracts to meet its deadlines. As of Monday morning, no payment had been made.
It is the first time that Russia has failed to pay its international creditors in more than a century. In 1918, the Bolshevik power had chosen to cancel the debt subscribed by the tsarist regime. In 1998, two bond lines in dollars had also been “forgotten”, as Paul McNamara, emerging countries manager at GAM, recalls in a Tweet. But that was during the giant restructuring of the country’s ruble debt.
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