Russia wants to stabilize the situation with the issue of bonds

The Russian state budget is suffering from declining revenues from the oil business. Strong ruble volatility is slowing the flow of international investors. Therefore, Russia plans to issue bonds on the international capital market.

The Treasury is also trying to encourage domestic investors to invest more in Russian government bonds and the development of the Russian economy. The Ministry of Finance notes the need to integrate the population in order to stabilize the state budget.

"We will most likely prepare the issue," said Russian Deputy Finance Minister Sergei Storchak, without giving details. The budget stipulates that the government can borrow up to $ 3 billion from foreign donors this year. Last week, Storchak highlighted the issue of so-called Eurobonds, which are out of the question as the West supports sanctions against the country. This year, Russia must pay 38 percent less debt compared to 2015.

The decline in oil prices hit the country's national budget, which is sensitive to this raw material. To date, most funding gaps have been closed with sovereign wealth funds. Because this practice is unsustainable, Moscow is trying to raise money in the capital markets. The depreciation of the ruble had a negative impact on the prices of Russian government bonds. This year alone, the exchange rate has dropped by almost six percent. International investors are holding back from buying because there is a high risk that the bonds will not be redeemed in the future, even in a weaker local currency.