Russia threatens retaliation if US sanctions push it into default

Russia will sue if the West tries to force it to default on sovereign debt, Finance Minister Anton Siluanov said on April 11, sharpening Moscow's tone in its financial fight with the West, reports Reuters.

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“Of course, we will sue, because we have taken all the necessary steps to ensure that investors receive their payments,” Siluanov said. “We will present to the court our invoices confirming our attempts to pay both in foreign currency and in rubles. This will not be an easy process. We will have to very actively prove that we are right, despite all the difficulties.”

Siluanov did not specify the legal possibilities of Russia.

On the subject: Both legs are crippled: an American journalist miraculously got out from under Russian shelling in Ukraine

Russia faces its first sovereign external default. Russia did not default on its external debt after the 1917 revolution. Earlier this week, it agreed to redeem international bonds in rubles, although the payment was to be made in US dollars.

Siluanov said last week that Russia would do everything possible to secure payments to its creditors.

“Russia tried in good faith to pay off external creditors,” Siluanov said on April 11. “Nevertheless, the deliberate policy of Western countries is to create an artificial default by all means.”

Siluanov said that Russia's foreign liabilities account for about 20% of the total public debt, which is about $261,7 billion.

Default was unimaginable until recently.

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“If an economic and financial war is waged against our country, we are forced to react, while fulfilling all our obligations,” Siluanov said. “If we are not allowed to do it in foreign currency, we do it in rubles.”

As ForumDaily wrote earlier:

• United On April 4, the States banned the Russian government from paying the holders of its sovereign debt of more than $600 million from reserves held in US banks, which should increase pressure on Moscow and absorb its dollar reserves.

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