The Russians had the resources to pay on the debt, and were oh so willing to do so. We simply didn't let them, pushing them into default. To the bondholders it doesn't matter. Their bonds don't have an escape clause for Russia in the case of sanctions. So yes, they are indeed in default.
It matters not a whit at present because they aren't borrowing on the international market these days. But it does mean that they have no capacity to borrow on the open market in the future unless and until "things" change.
If their needs change, they could always borrow government to government, say, from China. That would get around both sanctions and the complications of default affecting lenders' perception of risk. But then they would be at the whims and pleasure of another government ...
Posts: 12759 | Location: Williamsburg, VA | Registered: 19 July 2005
