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. Last Updated: 07/27/2016

Paris Club Calls on Russia to Honor Debt

PARIS - The Paris Club of creditor nations said Monday that it would not tolerate a unilateral default by Russia on its international debt dating back to the Soviet era.

In a letter to Russian Finance Minister Alexei Kudrin, Paris Club Chairman Jean-Pierre Jouyet said the Paris-based informal group of creditor nations "doesn't condone any debtor's unilateral default," said a statement that summarized the letter.

Given Russia's current favorable economic situation, the Paris Club expects Russia "to honor in full the debt service arising from all categories of obligations," the statement said.

Russian President Vladimir Putin vowed Sunday, after meeting with German Chancellor Gerhard Schroeder, that all international debt would be paid, saying that Russia was "determined and will fulfill its financial obligations." Germany is Russia's No. 1 creditor.

The comments came amid concern about Russia's intentions after the Kremlin said last week that it would miss first-quarter payments this year to the Paris Club, a group of countries owed $48 billion in Soviet-era debt.

The Paris Club has said that Russia owed creditor members $560 million in January and $1.27 billion in February. Overall payments due in 2001 are worth $5.9 billion, of which $3.5 billion arose form pre-1992 obligations.