World News

WELLINGTON, New Zealand (AP) — Queen Elizabeth II once asked why the New Zealand men’s cricket team had picked a 17-year-old for the starting lineup.

“Is this a case of absolute confidence or sheer desperation?” the British monarch wondered, Don McKinnon recalled Friday.

McKinnon, who was secretary-general of the Commonwealth countries at the time, said it showed the queen’s broad interests, whether it be in horses, sports or the stories of the thousands of people she met.

McKinnon made the comments during the keynote speech at a New Zealand church service to mark Elizabeth’s 70 years on the throne. The queen’s Platinum Jubilee is being celebrated over several days in Britain and more than 50 other Commonwealth countries.

McKinnon also recalled the time he tumbled off one of the queen’s horses and limped into a meeting with her soon after. He said he was very pleased with her response, which he would have expected from any New Zealand farmer: “How’s the horse?”

McKinnon recalled Elizabeth’s warm personality, the way she smiled vividly with her eyes, and her serenity considering the havoc going on around her.

Elizabeth has visited New Zealand 10 times during her reign. On her first trip in 1953-54 she laid the foundation stone for the Wellington Cathedral of St. Paul, where Friday’s service took place.

“For us, on this side of the world so far away, we will always know her as someone who enjoyed coming to New Zealand, who enjoyed meeting New Zealanders,” McKinnon said. “Seventy years of grit, grace and glory.”

New Zealand’s Prime Minister Jacinda Ardern also spoke briefly at the service, saying that people were marking the jubilee milestone with a sense of “awe, reverence and gratitude.”

New Zealand also celebrated by lighting a beacon and having the army fire a 21-gun salute. The British monarch remains New Zealand’s official head of state, although the role is now considered primarily ceremonial.

For the record, the young cricketer, Daniel Vettori, turned 18 just before playing his first test match for New Zealand vs. England in 1997, breaking the record for the youngest player to make the squad. He would go on to become one of the nation’s most successful all-round players.

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(Reuters) – Russia’s Pacific Fleet launched a week-long series of exercises with more than 40 ships and up to 20 aircraft taking part, Russian news agencies quoted the defence ministry as saying.

The ministry statement said the exercises, taking place from June 3-10, would involve, among other matters, “groups of ships together with naval aviation taking part in search operations for (enemy) submarines”.

The exercises were taking place amid Russia’s three-month-old incursion into Ukraine, described by Moscow as a “special military operation”. Ukraine lies thousands of kilometres to the west of where the exercises are occurring in the Pacific.

(Reporting by Ronald Popeski; Editing by Himani Sarkar)

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KYIV (Reuters) -Russian forces tightened their grip on an industrial Ukrainian city as part of their drive to control the eastern Donbas region and targeted rail links used to ferry in weapons from Kyiv’s Western allies as the war approaches its 100th day on Friday.

Russia has accused the United States of adding “fuel to the fire” after President Joe Biden announced a $700 million weapons package for Ukraine that will include advanced rocket systems with a range of up to 80 km (50 miles).

Ukraine’s President Volodymyr Zelenskiy told a forum in Slovakia on Thursday that Kyiv was grateful for the military aid it has received but added: “Weapons supplies should be stepped up … (to) ensure an inflection point in this confrontation.”

The Biden administration said Ukraine had promised it would not use the rocket systems to hit targets inside Russia. Biden hopes extending Ukraine’s artillery reach will help push Russia to negotiate an end to a war in which thousands of people have been killed, cities and towns flattened and more than six million people forced to flee the country.

“Ukraine needs weapons to liberate Ukrainian territory that Russia has temporarily occupied. We are not fighting on Russian territory, we are interested in our sovereignty and territorial integrity,” said Andriy Yermak, Zelenskiy’s chief of staff, shrugging off Moscow’s criticism of the U.S. decision.

Moscow has said it regards Ukrainian infrastructure used to bring in Western arms as a legitimate target in what it calls its “special military operation” to disarm Ukraine and rid it of ultra-nationalists the Kremlin says threaten Russian security.

“Pumping (Western) weapons into Ukraine does not change all the parameters of the special operation,” Kremlin spokesman Dmitry Peskov told reporters on a conference call.

“Its goals will be achieved, but this will bring more suffering to Ukraine,” said Peskov, responding to a question about whether U.S. plans to sell Ukraine four MQ-1C Gray Eagle drones that can be armed with Hellfire missiles for battlefield use could change the parameters of the conflict.

Four Russian missiles hit railway infrastructure targets in two places in the western Lviv region bordering Poland late on Wednesday, governor Maksym Kozytskyi said, injuring five people and causing significant damage.

DONBAS CITY IN FOCUS

Zelenskiy told Luxembourg’s parliament via videolink on Thursday that Russian forces currently occupy about 20% of all Ukrainian territory and that battle frontlines now stretch more than 1,000 km (620 miles).

Russian forces, backed by heavy artillery, control most of Sievierodonetsk – now largely in ruins – after days of fierce fighting in which they have taken losses, Britain’s defence ministry said in its daily intelligence report.

“The enemy is conducting assault operations in the settlement of Sievierodonetsk,” Ukraine’s armed forces general staff said, adding that Russian forces were also attacking other parts of the east and northeast.

At least four civilians were killed and 10 wounded in the east and northeast, other officials said.

Russia denies targeting civilians.

If Russia fully captures Sievierodonetsk and its smaller twin Lysychansk on the west bank of the Siverskyi Donets river, it would hold all of Luhansk, one of two provinces – with Donetsk – in the Donbas claimed by Moscow on behalf of separatists.

Capturing Luhansk would fulfil one of Russian President Vladimir Putin’s stated aims and solidify a shift in battlefield momentum after his forces were pushed back from the capital Kyiv and from northern Ukraine.

Ukraine’s General Oleksiy Gromov told a briefing that Russian forces were trying to assault the village of Berestove that lies on a main road linking Lysychansk – also under heavy Russian shelling – to the rest of the country.

Donetsk governor Pavlo Kyrylenko said Russian forces were attempting to advance south towards the key Ukraine-held cities of Kramatorsk and Sloviansk, both in Donetsk province.

GLOBAL IMPACT

The war is having a massive impact on the world economy. Russia has captured some of Ukraine’s biggest seaports and its navy controls major transport routes in the Black Sea, blocking Ukrainian shipments and deepening a global food crisis.

Russia and Ukraine together account for nearly a third of global wheat supplies, while Russia is also a key fertilizer exporter and Ukraine a major supplier of corn and sunflower oil.

Ukraine’s foreign ministry spokesman, Oleg Nikolenko, said Kyiv was working with international partners to create a U.N.-backed mission to restore Black Sea shipping routes and allow the export of Ukrainian farm produce.

In further evidence of the economic strain on Ukraine, its central bank hoisted the main interest rate to a seven-year-high of 25% from 10% on Thursday to tackle soaring inflation and shield the hryvnia currency. Bank governor Kyrylo Shevchenko also said it was time to start talks with the International Monetary Fund on a new economic support programme.

Moscow criticised as “self-destructive” a decision by the European Union this week to cut 90% of oil imports from Russia by the end of 2022, saying the move could destabilise global energy markets.

The conflict has also jolted Europe’s security arrangements, prompting Finland and Sweden to seek NATO membership, though NATO member Turkey has blocked that move, accusing Stockholm and Helsinki of harbouring people linked to Kurdish militants.

The issue will be on the agenda when Biden hosts NATO Secretary-General Jens Stoltenberg at the White House on Thursday. Stoltenberg told reporters he would soon convene a meeting in Brussels with Swedish, Finnish and Turkish officials to discuss the matter.

In a rare moment of joy for Ukraine, its soccer team advanced towards securing a place in this year’s World Cup finals with a 3-1 win over Scotland on Wednesday evening.

“Sometimes you don’t need a lot of words! Just pride … They went out, fought, persevered and won. Because they are Ukrainians!” said Zelenskiy in a message posted on the Telegram app alongside a picture of the players celebrating.

(Reporting by Reuters bureaux; Writing by Robert Birsel and Gareth Jones; Editing by Stephen Coates, Raju Gopalakrishnan, Nick Macfie and Catherine Evans)

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WASHINGTON (Reuters) – The Biden administration on Thursday issued a raft of new sanctions aimed a punishing Russia for its invasion of Ukraine, with targets including several yachts linked to Russian President Vladimir Putin, a yacht brokerage and a cellist it says acts as a middleman for the Russian leader.

The United States and other Western countries have imposed unprecedented sanctions on Russia’s economy since the Feb. 24 invasion, including the country’s central bank and major financial institutions.

In his State of the Union address in March, Biden said the United States would work to seize the yachts, luxury apartments and private jets of wealthy Russians with ties to Putin.

The U.S. Treasury Department identified two vessels, the Russian-flagged Graceful and the Cayman islands-flagged Olympia as property in which Putin has an interest. The Russian president, who was blacklisted the day after his Feb. 24 invasion of Ukraine, has taken numerous trips on the yachts, including one in the Black Sea with Belarusian President Aleksandr Lukashenko last year, the Treasury said.

It also identified two other yachts it said were used by Putin and owned by a sanctioned Russian company.

The Treasury also targeted Imperial Yachts, a brokerage based in Monaco that allows superyacht owners, including Russian oligarchs, to charter their boats when they are not using them, as well as an aviation company it said was involved in a scheme to transfer aircraft to an offshore company to avoid sanctions.

The Biden administration also added Sergei Roldugin, a cellist and conductor already under European Union sanctions for his links to Putin, to its list of sanctioned individuals. The order froze his U.S. assets and barred U.S. people from dealing with them.

The State Department also imposed sanctions on five Russian oligarchs and members of the country’s elite, including the spokesperson for the Russian Ministry Foreign Affairs, Maria Zakharova.

Putin sent his troops over the border on what he calls a special military operation on Feb. 24 to disarm and “denazify” Ukraine. Ukraine and its allies call this a baseless pretext for a war of aggression.

(Reporting by Simon Lewis and Doina Chiacu; editing by Jonathan Oatis)

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By Michael Holden and Kate Holton

LONDON (Reuters) – A beaming Queen Elizabeth waved to cheering crowds massed outside Buckingham Palace on Thursday as Britain kicked off four days of pomp, parties and parades to celebrate her record-breaking 70 years on the British throne.

Tens of thousands of royal supporters waving flags lined the streets of London for a military parade at the start of the four-day Platinum Jubilee. Millions of people across Britain and the world were expected to watch the festivities, join street parties and light beacons in honour of the 96-year-old queen.

Elizabeth, holding a walking stick and wearing a dusky dove blue outfit that she also wore for an official Jubilee photograph, was joined by her son and heir Prince Charles, 73, and other senior royals on the balcony of Buckingham Palace.

While the family waved to the crowds and enjoyed a Royal Air force fly-past, Louis – Prince William’s 4-year-old son – covered his ears and howled as the planes roared overhead. He later jumped up and down as Red Arrow jets released red, white and blue smoke trails.

Elizabeth has been on the throne for longer than any of her predecessors, and is the third-longest reigning monarch ever of a sovereign state. Opinion polls show she remains hugely popular and respected among British people.

World leaders including U.S. President Joe Biden, France’s Emmanuel Macron, Pope Francis and former British prime ministers were among those sending messages of goodwill.

“Thank you to everyone who has been involved in convening communities, families, neighbours and friends to mark my Platinum Jubilee, in the United Kingdom and across the Commonwealth,” the queen said in a statement as the festivities got under way.

“I continue to be inspired by the goodwill shown to me.”

The celebrations began with the Trooping the Colour, a military parade held annually to mark the queen’s official birthday, where 1,500 soldiers marched to military music in ceremonial uniforms of scarlet tunics and bearskin hats.

Later the crowds moved to the Mall, the grand boulevard running up to Buckingham Palace, where in brilliant sunshine they cheered and waved Union flags while a display of modern and historic planes took place overhead.

Fifteen Typhoon jets spelled out the number 70.

MILITARY PARADE

Thursday marks not only the start of the Jubilee, but also the 69th anniversary of the coronation of Elizabeth, who became queen on the death of her father George VI in February 1952.

Her involvement in this year’s celebrations will be somewhat limited compared with previous major events. In recent months the queen has cut back public appearances due to what Buckingham Palace calls “episodic mobility issues”. In May, she missed the opening of parliament for the first time in almost six decades.

Senior royals, including Charles, and his eldest son William, 39, are carrying out some ceremonial duties on the queen’s behalf.

Some royal family members were absent on Thursday, including the queen’s second son Prince Andrew, 62, who settled a U.S. lawsuit in February in which he was accused of sexually abusing a woman when she was underage. Andrew denied the accusation.

The palace announced later that Andrew had tested positive for COVID-19 and would not attend a service of Thanksgiving on Friday.

The queen’s grandson Prince Harry, now living in Los Angeles with his American wife Meghan after stepping down from royal duties, watched the parade but was absent from the palace balcony, with only “working” members of the family present.

There were artillery gun salutes in London, across the United Kingdom and from Royal Navy ships at sea.

“It was lovely, everything we hoped it would be. We’re a bit older now, so we were here for the 25th and then the 50th (jubilee). But this was the best one,” said nurse Ian Higgins, 62, who was watching the events in central London.

“You feel very proud when everybody comes together like this,” said yoga teacher Amanda Mackenzie, 51. “It’s really special.”

In the evening beacons will be lit across the country and the Commonwealth, with the queen set to lead with the lighting of the Principal Platinum Jubilee Beacon at her Windsor Castle home.

The government announced two public holidays to mark the celebration, which is the first major public gathering since the pandemic and a welcome distraction for many at a time of growing economic hardship.

Among the tributes pouring in from around the world was a video message from former U.S. president Barack Obama that was broadcast on the BBC.

“Your life has been a gift, not just for the United Kingdom, but for the world. And it is with gratitude for your leadership and the kindness that you’ve shown me and my family that I say, may the light of your crown continue to reign supreme,” he said.

Not everyone will be joining in the festivities though, including the anti-monarchy campaign group Republic which has put up the message “Make Elizabeth the last” on billboards across Britain.

A number of people caused a brief disturbance by running out in front of marching soldiers on the Mall boulevard before they were dragged away by police. Several were arrested.

(Reporting by Michael Holden, Kate Holton, Natalie Thomas, Lucy Marks and Paul Hardy; Editing by Raissa Kasolowsky and Frances Kerry)

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TOKYO (AP) — Shuntaro Tanikawa used to think poems descended like an inspiration from the heavens. As he grew older — he is now 90 — Tanikawa sees poems as welling up from the ground.

The poems still come to him, a word or fragments of lines, as he wakes up in the morning. What inspires the words comes from outside. The poetry comes from deep within.

“Writing poetry has become really fun these days,” he said recently in his elegant home in the Tokyo suburbs.

Shelves were overflowing with books. His collection of ancient bronze animal figurines stand in neat rows in a glass box next to stacks of his favorite classical music CDs.

“In the past, there was something about its being a job, being commissioned. Now, I can write as I want,” he said.

Tanikawa is among Japan’s most famous modern poets, and a master of free verse on the everyday.

He has more than a hundred poetry books published. With titles like “To Live,” “Listen” and “Grass,” his poems are stark, rhythmical but conversational, defying elaborate traditional literary styles.

William Elliott, who has translated Tanikawa for years, compares his place in Japanese poetic history to how T. S. Eliot marked the beginning of a new era in English poetry.

Tanikawa is also a reputed translator, having translated Charles Schulz’ “Peanuts” comic strip into Japanese since the 1970s. He demonstrated his ear for the poetic in the colloquial with finesse, choosing “yare yare” for “good grief,” transcending the lifestyle differences of East and West in the universal world of children and animals.

“He was more a poet or a philosopher,” he said of Schulz.

Tanikawa has translated many others’ works, including Mother Goose, as well as Maurice Sendak and Leo Lionni. In turn, his works have been widely translated, including into Chinese and European languages.

Tanikawa’s poem “Two Billion Light-Years of Solitude” catapulted him to stardom in the early 1950s. Tanikawa had his eyes on the cosmos and Earth’s spot in the universe, years before Gabriel Garcia Marquez wrote the magical realism classic, “One Hundred Years of Solitude.”

Tanikawa was always in demand, the darling of poetry readings around the world, a rare example of a poet who effortlessly crossed over to commercialism without compromising his art.

But poetry used to be a job — his profession, his daily work.

Tanikawa is the lyricist for the Japanese theme song for Osamu Tezuka’s TV animated series “Astro Boy.” He also wrote the script for the narration of Kon Ichikawa’s documentary of the 1964 Tokyo Olympics.

A popular author of children’s picture books, he is often featured in textbooks.

He swears he doesn’t have “projects” anymore because of his age, which has made walking and going out more difficult. But in the same breath he says he is collaborating with his musician son Kensaku Tanikawa, who lives next door, on what they call “Piano Twitter.”

He has already written dozens of poems to go with the score. They are all short, more abstracted than his past work, conjuring surreal images like staircases descending to nowhere, or a caterpillar dancing uncontrollably.

He isn’t sure how the work will be presented, but speculated it could become a book with a barcode so readers can listen to the poems being read with music online.

Among his voluminous output, he is most proud of his 1970s “Kotoba Asobi Uta” series, which utilized singsong alliterations and onomatopoeia, as the title “Word Play Songs” implies.

One repeats the phrase “kappa,” a mythical monster, as in: “kappa kapparatta,” which translates to “the kappa took off with something” — a “rappa,” a “trumpet,” as it turns out in a later line. The poetry is, both visually and aurally, a sheer celebration of the Japanese language.

That was unique, Tanikawa said, and he still likes what he came up with.

“For me, the Japanese language is the ground. Like a plant, I place my roots, drink in the nutrients of the Japanese language, sprouting leaves, flowers and bearing fruit,” he said.

Married and divorced three times — to a poet, an actress and an illustrator — Tanikawa stressed he was changing with age, noting 90 felt much older than 80, and he was getting forgetful.

Yet he appeared on a recent sunny afternoon totally comfortable with social media and everyday technology, although he used a magnifying glass to make out fine print. He was curious about new movies, including what might be on Netflix. He likes eating cookies, he said, looking more like a mischievous child than the great-grandfather that he is.

He usually works at his huge desk in a spacious study, which has a window that lets in the breeze and a fuzzy ray of light. It looks out into a yard with flowers. On the wall hangs a sepia-toned portrait of his mother with his father, Tetsuzo Tanikawa, a philosopher.

While growing up, Tanikawa was more afraid about his mother’s dying than of any other death. He also remembers how he saw corpses upon corpses after the American air raids of Tokyo during World War II.

“Death has become more real. It used to be more conceptual when I was young. But now my body is approaching death,” he said.

He hopes to die as his father did, in his sleep after a night of partying, at 94.

“I am more curious about where I go when I die. It’s a different world, right? Of course, I don’t want pain. I don’t want to die after major surgery or anything. I just want to die, all of a sudden,” he said.

When asked to read his works out loud, he doesn’t hesitate.

He reads excerpts from his latest collaboration with his son. Then he reads his debut work that, translated into English, ends with these lines:

“The universe is twisted, / That is why we try to connect. / The universe keeps expanding, / That is why we are all afraid. / In two billion light-years of solitude / I suddenly sneeze.”

So what does he think?

“It feels like a poem written by someone else,” Tanikawa said.

But it’s a good poem?

He nods with conviction.

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Yuri Kageyama is on Twitter: https://twitter.com/yurikageyama

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By Natalie Grover

LONDON (Reuters) – Outbreaks of endemic diseases such as monkeypox and lassa fever are becoming more persistent and frequent, the World Health Organization’s (WHO) emergencies director, Mike Ryan, warned on Wednesday.

As climate change contributes to rapidly changing weather conditions like drought, animals and human are changing their behaviour, including food-seeking habits. As a result of this “ecologic fragility”, pathogens that typically circulate in animals are increasingly jumping into humans, he said.

“Unfortunately, that ability to amplify that disease and move it on within our communities is increasing – so both disease emergence and disease amplification factors have increased.”

For instance, there is an upward trend in cases of Lassa fever, an acute viral illness spread by rodents endemic to Africa, he said.

“We used to have three to five years between Ebola outbreaks at least, now it’s lucky if we have three to five months,” he added.

“So there’s definitely ecological pressure in the system.”

His commentary comes as cases of monkeypox continue to rise outside Africa, where the pathogen is endemic.

On Wednesday, the WHO said it had so far received reports of more than 550 confirmed cases of the viral disease from 30 countries outside of Africa since the first report in early May.

Meanwhile, although COVID-19 cases are declining globally, there are regions such as the Americas with concerning trends, WHO director-General Tedros Adhanom Ghebreyesus highlighted in a briefing on Wednesday.

In North Korea, officials suspect there are over 3.7 million cases of fevered people, that could be COVID, as the country battles against its first ever COVID outbreak. It declared a state of emergency and imposed a nationwide lockdown last month.

Ryan said although the WHO had offered the country support in terms of vaccines, treatments and other medical supplies, it had encountered problems in securing access to raw data that would reflect the situation on the ground.

The experience of COVID has triggered the WHO to kickstart a process to draft and negotiate an international treaty to strengthen pandemic prevention, preparedness and response.

Pandemics, like climate change, affect every citizen on the planet, said Ryan.

“We’ve seen the difficulties we faced in this pandemic – we may face a more severe pandemic in the future and we need to be a hell of a lot better prepared than we are now,” said Ryan.

“We need to establish the playbook for how we’re going to prepare and how we’re going to respond together. That is not about sovereignty. That’s about responsibility.”

(Reporting by Natalie Grover in London; Twitter @NatalieGrover Editing by Catherine Evans and Mark Potter)

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HANOI (Reuters) – Vietnam said on Wednesday it had successfully developed a vaccine to administer to pigs to fight African swine fever, with the aim of becoming the first country to commercially produce and export it.

African swine fever, one of the most devastating livestock diseases, was first detected in Vietnam in February 2019 and forced the country to cull around 20% of its hog herd last year.

It originated in Africa before spreading to Europe and Asia and has killed hundreds of millions of pigs globally. African swine fever is harmless to humans.

“This is a milestone of the veterinary industry,” deputy agriculture minister Phung Duc Tien said in a statement.

“With immunity lasting six months, the vaccine will be a shield for hog-raising industry and pig production globally.”

The vaccine has been in development since November 2019 in partnership with United States experts, with five clinical trials held.

Its safety and efficacy was confirmed by the Agricultural Research Service under the U.S. Department of Agriculture, Tien said.

“This success opens great expectations and the room to export African swine fever vaccine produced in Vietnam is huge,” Tien added.

He did not provide a timeframe for when the vaccine could be exported or estimate of Vietnam’s production capacity.

Although the swine fever outbreak has subsided in Vietnam, allowing farmers to rebuild hog herds, the virus is still hurting farms in some countries.

(Reporting by Phuong Nguyen; Editing by Martin Petty)

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By Jorgelina do Rosario

LONDON (Reuters) – In 1918, Soviet revolutionary Leon Trotsky told Western creditors aghast at the Bolsheviks’ repudiation of Russia’s external debt: “Gentlemen, you were warned.”

He reminded them that dismissal of Tsarist-era debt had been a key manifesto of the failed uprising in 1905. More than a century later, Russia stands on the brink of another default but this time there was no warning.

Few expected the Kremlin’s invasion of Ukraine to elicit such a ferocious response from the West, which has all but severed Russia from global financial and payment systems.

These are Russia’s major debt events over the past century:

1918: REPUDIATION

Just before the 1917 revolution, Russia was the world’s largest net international debtor, having borrowed heavily to finance industrialisation and railways.

But seeing the Tsarist industrialisation drive as failing the working class, the Bolsheviks repudiated all foreign debt.

“They said ‘we are not paying and even if we could, we wouldn’t pay.’ And that was a political statement,” said Hassan Malik, senior sovereign analyst at Loomis Sayles and the author of the book “Bankers and Bolsheviks: International Finance and the Russian Revolution”.

Despite Trotsky’s reminder, the default shocked the world, especially France, whose banks and citizens suffered massive losses.

“Investors didn’t take it seriously because they thought it would be so self-harmful,” Malik said, estimating the debt to be worth at least $500 billion at 2020 prices and possibly more.

It took until the mid-1980s for Moscow to recognise some of that debt.

1991: USSR TO RUSSIA

Following the break-up of the USSR in 1991, Russia stopped servicing part of the overseas debt it inherited from former Soviet states.

Andrey Vavilov, Russia’s deputy finance minister between 1994 and 1997, said the Russian Federation held around $105 billion in Soviet-era debt at the end of 1992, with its own debt amounting to $2.8 billion.

For accepting the inherited debt, the Paris Club recognised Russia as a creditor nation, Vavilov wrote in his book “The Russian Public Debt and Financial Meltdowns”. And as Russia agreed with the group of nations to restructure $28 billion in debt in 1996, it was allowed to shift major Soviet-era debt payments to the next decade.

But with a financial crisis around the corner, it would take until 2017 to clear the Communist-era arrears.

1998: ROUBLE DEBT DEFAULT

By 1997, crashing oil prices slashed Russian export revenues. External debt, which stood near 50% of GDP in 1995, had swelled by 1998 to 77%, according to Vavilov, who blamed hefty IMF/World Bank loans for contributing to the pile.

Russia raised very little tax revenue and relied on short-term Treasury bills known as GKO to cover expenditure. But it found it harder and harder to roll these over and was soon spending ever-increasing amounts to defend the rouble.

“The more the government insisted that it would stand by the currency and repay its debts, the more investors concluded it was time to sell,” said Chris Miller in his book “Putinomics: Power and Money in Resurgent Russia”.

A month before the default, the IMF put together a $22.6 billion aid package, but “the market was expecting the announcement of an additional $20 billion,” Martin Gilman, the IMF representative in Moscow at the time, wrote in his book “No Precedent, No Plan: Inside Russia’s 1998 Default”.

On Aug. 17, 1998, Russia threw in the towel, devaluing the rouble, announcing it could no longer pay rouble debt and introducing a three-month moratorium on some external debt.

Russian banks that had invested heavily in T-bills and had extensive foreign currency exposure soon went under.

2022: A FORCED DEFAULT

Through dire financial straits in 1998, Moscow made sure to continue Eurobond payments. Now it has plenty of cash but may not dodge default.

To sidestep sanctions, the Kremlin is suggesting foreign creditors open Russian bank accounts to receive payments in alternative currencies to the dollar.

Non-U.S. investors can in theory agree, but U.S. bondholders cannot, after a U.S. Treasury licence allowing them to accept Russian payments expired in May.

Miller, author of “Putinomics”, said Russia would fight tooth and nail to dodge a Eurobond default.

“The officials on the central bank and the finance ministry have built their careers on restabilising Russia as a creditor that can be trusted in international markets,” he said.

“It’s built into their identity to make sure a default doesn’t happen again.”

(Reporting by Jorgelina do Rosario, editing by Sujata Rao and Nick Macfie)

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LONDON (Reuters) – The Kremlin said on Wednesday the world could be on the verge of a major food crisis, blaming “illegal restrictions” imposed on Russia by Western countries and decisions by Ukrainian authorities.

More than three months since invading Ukraine, Russia has seized large parts of its neighbour’s coast and is blockading its ports, but is trying to pin the blame for the lack of grain shipments on Western sanctions and on Kyiv itself.

“We are potentially on the verge of a very deep food crisis linked to the introduction of illegal restrictions against us and the actions of Ukrainian authorities who have mined the path to the Black Sea and are not shipping grain from there despite Russia not impeding in any way,” Kremlin spokesman Dmitry Peskov told reporters on a conference call.

(Reporting by Reuters)

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