The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris take a look at how Russia continues to aggressively disengage from the dollar dominated neo-liberal world order. The Russian government has announced that it has cut its foreign debt to decade lows, while boosting national reserves.
Meanwhile the Russian economy moves ever closer to China, in economic and geopolitical spheres.
Russia’s external debt has fallen by $64.4 billion or 12.4 percent from the beginning of last year, amounting to $453.7 billion as of January 1, 2019 – the lowest level since April 2009, according to Central Bank of Russia data.
All institutional sectors dropped their debts last year, the Central Bank of Russia announced on Monday, adding that other sectors contributed “the most to the country’s external debt contraction,” reducing their indebtedness by $32.3 billion.
The foreign debt has been dropping since mid-2014, when it reached its peak of around $733 billion in the wake US and EU sanctions. Since then, Russia managed to reduce debt by nearly $280 billion to reach the ten year minimum. In the fourth quarter of 2018 alone, the external debt was reportedly reduced by more than $16 billion or some 3.5 percent.
— Dean Fantazzini (@DeanFantazzini) January 21, 2019
According to macro-statistical data, total external debt payments of non-financial institutions, including principal and interest, in the fourth quarter of 2018 and in the first quarter of 2019 will total $21.8 and $10.7 billion respectively.
The regulator said that Russia is expected to repay more than $4.8 billion in debt of 40 of the largest non-financial corporate borrowers in the first quarter of 2019. $800 million dollars is expected to be paid off in January, $772 million in February, and $3.3 billion in March.
Earlier this year, the Central Bank reported that foreign exchange reserves surged for the third consecutive year, boosted by 8.3 percent over the 12 months as of the beginning of 2019. Reserves saw growth of over $468 billion from $432 billion at the beginning of last January.
Moscow has been consistently eliminating its reliance on the greenback. The Central Bank’s latest quarterly report shows Russia has significantly cut the share of the US currency in foreign reserves to a historic low after it converted nearly $100 billion to euros, the Japanese yen and the Chinese yuan.