As a result of Western sanctions against Russia, the country is unable to pay off some of its foreign debts for the first time since 1918. The grace period expired on Sunday, amounting to about $100 million in interest payments, which Russia owed to foreign investors since May 27.
Due to the expiry of that term, Russia can now be regarded as a defaulter. Although, in practice, the default is mainly symbolic for the time being, due to all the economic damage that Russia has already incurred in recent months. It will have little effect on the daily lives of Russians, who are already battling sky-high inflation and the worst economic contraction in a long time.
Russia denies that it is unable to pay its debts. The Russian government says it still has the means to do so, but is being forced into non-payment by the West.
During the Russian financial crisis and the collapse of the Russian currency in 1998, the government of then President Boris Yeltsin failed to pay off $40 billion in domestic debt. But the last time the country defaulted on its foreign creditors was more than a century ago.