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Russia hidden war debt and a looming credit crisis


Published on 2025-01-13 14:40:46 - MSN
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  • By Ben Aris in Berlin Moscow has been quietly pursuing a two-pronged strategy to finance its escalating war costs. In addition to the publicly scrutinised defence budget, it has set up a system of state-directed off-budget soft loans where the Kremlin badgers banks into making easy credits to defence sector companies to fund its war machine

The article from MSN discusses Russia's escalating financial challenges due to its ongoing war efforts in Ukraine, which have led to a significant increase in hidden war debt. Despite official figures showing a decrease in public debt, the actual cost of the war, including military spending and economic sanctions, has pushed Russia towards a potential credit crisis. The war has not only strained Russia's budget but also led to a sharp decline in oil and gas revenues, traditionally a major source of income for the country. Furthermore, the article highlights the use of off-budget funds and loans from state-owned banks to finance the war, which are not reflected in the national debt statistics. This hidden debt, combined with international sanctions and a lack of access to global financial markets, could precipitate a financial crisis, as Russia struggles with rising costs, dwindling reserves, and an economy increasingly isolated from the global financial system.

Read the Full MSN Article at:
[ https://www.msn.com/en-us/money/other/russia-hidden-war-debt-and-a-looming-credit-crisis/ar-BB1ro2t3 ]