Russia-Ukraine conflict: West accused of forcing Russia into 'artificial default' from sanctions

Countries all over the world have come together in imposing sanctions on Russia targeting its economy after dictator Vladimir Putin ordered an invasion into Ukraine. Russia’s finance ministry is now accusing the West of forcing Russia to go into an “artificial default” due to the sanctions.

Russia’s finance minister Anton Siluanov released a statement Monday accusing the West of attempting to force Russia to go into default because of the number of economic sanctions. Siluanov added that Russia would pay its debt obligations.

“The freezing of foreign currency accounts of the Bank of Russia and of the Russian government can be regarded as the desire of a number of foreign countries to organize an artificial default that has no real economic grounds,” said Siluanov in the statement.

“Claims that Russia cannot fulfill its sovereign debt obligations are untrue,” Siluanov added. “We have the necessary funds to service our obligations.”

The finance ministry said that it has approved a temporary measure that will allow banks to make payments in foreign currency. However, the ministry said the possibility of the payments going through will depend on the sanctions imposed on Russia due to the invasion. Several Russian banks have already been banned from the SWIFT international payments network, hindering the efforts to move money outside the country.

Siluanov went on to say that if the payments in foreign currencies are not possible, then Russia will be paying its debts in its local currency rubles according to the exchange rate of Russia’s central bank on the date of the payment, including the Eurobond issued since 2018.

Meanwhile, the US has warned China against coming to Russia’s aid in the midst of the ongoing conflict with Ukraine, warning that there will be repercussions should China join. US National Security Adviser Jake Sullivan met with China’s Office of the Foreign Affairs Commission Yang Jiechi in Rome this week, according to State Department spokesperson Ned Price.

“We are watching very closely the extent to which the PRC or any country in the world provides support – material, economic, financial, rhetorical, otherwise – to this war of choice that President Putin is waging against Ukraine,” said Price.