are there any precedents of this ? What is generally the alternative in such cases ? Do other authoritarian countries help you finance debt ?
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Turn towards East? China?– Roger V.Feb 23, 2022 at 12:45
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2 Answers
You could take the example of Cuba and Iran which have been for a long time under US sanctions. But there are also a lot of countries that are not officially barred, but can't take loans abroad because nobody trusts them. Sometimes those countries manage to get some loans directly from private institutions skipping the step of the public negotiation, sometimes they simply adapt their economy to work without asking a loan to a foreign country or institution.
BTW. Russia foreign debt is quite small. According to the Russian ministry of finance, the Russian debt in 2019 was 15.3% of GDP, with only 3.6% of GDP being foreign-held debt and 11.7% of GDP being debt held by domestic investors.
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What happened to Cuba and Iran? Did they get financial help from other authoritarian countries? Feb 23, 2022 at 12:04
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1Regarding the claim that Russia foreign debt is quite small: I think it would be interesting to see a source which shows how exactly Russian government debt is structured. Not that I doubt that claim, but it would be interesting to see some numbers nevertheless.– Philipp ♦Feb 23, 2022 at 12:06
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@Trilarion "What happened to Cuba and Iran? Did they get financial help from other authoritarian countries?" Yes, I know, the current financial elites make a lot of money by forcing governments into debt. Therefore they spread around the notion that a country cannot develop without making debt, but that is only propaganda, debts are not necessary. Feb 23, 2022 at 12:08
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3@Philipp can't you just put is a search engine the keywords "russia foreign debt by gdp" I am under the impression that the requirement to provide evidence has become a kind of mental lazyness where users ask evidence for the obvious instead of asking evidence for what is dubious. Feb 23, 2022 at 12:12
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2"requirement to provide evidence has become a kind of mental lazyness" Good answers should be based on facts and backed up by references where possible. Of course we can search for this ourselves, but where is the value in somebody only providing opinions that then need to be checked by everyone then anyway? Q&A here should be a knowledge repository, not a discussion forum or opinion poll. That's probably where references and exact numbers make content more useful. Just as explanation why one would ask for the amount of Russian foreign debt. Feb 23, 2022 at 12:17
Since the West will no longer allow Russia to raise money by selling sovereign debt, what alternatives does Russia have?
The Russian regime through the mainstream state-controlled Russian TV channels spoke about the pending Western sanctions. This means that Kremlin has already considered alternatives. They will be revealed in due course. Some politologists, such as Victor Nebozhenko, refer to China's regime as a possible source of support. (References provided upon request, in the meantime feel free to search for his recent clips on YT.)
Other sources of finances for the Putin's regime and their oligarch friends, families, and mistresses are continuing sales of Russian gas and other raw materials as well as weapons. There is little other Russian exports that exist, although I think that Stolichnaya Vodka and the like should be also accounted for, to be absolutely 100% precise (which I am not).
are there any precedents of this ?
None that I know of, although other Axes countries throughout history were under similar partial sanctions (USSR, Nazi Germany, Fidel's Cuba, fundamentalist Iran, Kim's North Korea).
What is generally the alternative in such cases ?
Friends around the world. Examples: Iran-Russia, North Korea-China.
Do other authoritarian countries help you finance debt ?
Yes, of course, authoritarian countries help other authoritarian countries. Also, "useful fools", partly corrupt, outright purchased, and blackmail-threatened politicians in democratic countries are considered high-quality assets for authoritarian regimes.
answered Feb 23, 2022 at 13:08
