The Finance Ministry made its latest interest payments, equivalent to about $400 million, under those rules on Thursday and Friday. However, none of the underlying bonds have terms that allow for settlement in the local currency.
So far, it’s unclear if investors will use the new tool and whether existing sanctions would even allow them to repatriate the money.
“Is it a justifiable excuse to say: ‘Oh well, the sanctions prevented me from making the payments, so it’s not my fault’?” said Malik, who is also author of ‘Bankers and Bolsheviks: International Finance and the Russian Revolution.’
“The broader issue is that the sanctions were themselves a response to an action on the part of the sovereign entity,” he said, referring to the invasion of Ukraine. “And I think history will judge this in the latter light.”
--With assistance from Irene García Pérez and Sydney Maki.
This article was provided by Bloomberg News.