Fitch announced the inevitability of default in Belarus

London-based international rating agency Fitch Ratings has lowered the long-term rating of Belarus from “CCC” to “C”. The new indicator means “imminent default”.

The agency noted that the downgrade occurred after the Belarusian Ministry of Finance announced on June 29 that the country would pay Eurobond payments in Belarusian rubles instead of US dollars. At the same time, Belarus made the first payment in national currency.

This is contrary to the bond documents, which do not allow settlements in alternative currencies.Fitch confirmed.

If Belarus does not pay the Eurobonds by the end of the grace period, on July 13, on the original terms (i.e. in dollars), then Fitch will consider this a default and lower the country’s rating to “RD” (restricted default), and the rating of this debt issue – to “D” (shortened).

The agency stressed that the status of “RD” will be preserved for Belarus until the country normalizes its relations with international creditors.

Russia’s fault

At the end of June, Bloomberg reported that Russia defaulted on its foreign debt for the first time since 1918. On the night of June 27, the deadline for Russia to repay $100 million in bonds expired. International rating agency Moody’s confirmed the default in the Russian Federation.

At the same time, as Bloomberg wrote earlier, there will be no official declaration of default from the Russian side and they will not recognize it there.

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