The Russian Federation will not take into account the ratings of Western agencies when lending to other countries
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The Russian government has adjusted the rules for issuing loans to foreign countries. The rule on refusing loans if the ratings of states compiled by Western credit agencies and the assessment of the Organization for Economic Co-operation and Development (OECD) does not meet a certain level has been abolished.
Resolution signed by Prime Minister Mikhail Mishustin. One of his points is not disclosed. It is indicated that it is “for official use”. The document cancels a number of requirements.
Now, states with a long-term credit rating below “B-” according to Fitch and Standard & Poor’s classifications and below “B3” according to Moody’s classification can apply for Russian loans. Also, countries that are in the sixth or lower country credit risk group from the OECD will be able to receive money.
The Russian Federation will be able to provide loans to countries whose average cost of sovereign credit default swaps in US dollars for a period of 10 years over the previous three months exceeds 800 basis points, according to Bloomberg. The conditions for the country’s compliance with the recommendations of international financial institutions and associations have been canceled. Repayment of loans must now be carried out in a currency agreed upon by the parties, which allows for the repayment and payment of the loans provided.
Total debt of residents of foreign countries to Russia in 2022 increased by $2.3 billion and amounted to $28.9 billion, the World Bank previously reported. The debt growth amounted to 8.7%. The largest debtors were Belarus, Bangladesh, India, Egypt and Vietnam.
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