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Russia Defaults on Foreign Debt for First Time in a Century

The Russian finance minister called the situation “a farce” after the country was unable to keep up with payments to international creditors.

Thanks to the nations that have all but blacklisted Russia from the global financial system, the country has defaulted on its foreign-currency debt for the first time since the tsar fell to the Bolsheviks. On Sunday night, the Kremlin missed the deadline for an interest payment worth roughly $100 million on a pair of foreign bonds, according to The Wall Street Journal, which marked the end of a 30-day grace period. The oil- and gas-rich nation isn’t exactly short on funds—rather, as the Journal reported, international sanctions have strangled its payment pathways, cutting off its access to the international banking systems that would allow the smooth transfer of repayment. Although a financial crisis in 1998 caused it to default on its ruble-denominated bonds, Russia has not failed to repay its foreign bondholders since 1918, when the leaders of the Bolshevik Revolution spurned the previous regime’s debt. Arguing that Russia has been strong-armed into defaulting, finance minister Anton Siluanov has called the situation “a farce,” according to the BBC.