Financial and Monetary Systems

What happens if a country defaults on its debts?

Due to sanctions, Russia could fail to pay $117 million in interest payments to foreign investors. Image: REUTERS/Maxim Shemetov/File Photo

Victoria Masterson

Senior Writer, Formative Content


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Chart showing total sovereign debt.
Investors in government debt include the International Monetary Fund, China, private creditors and foreign currency bonds and bank loans. Image: Bank of England

Chart showing levels of sovereign debt.
Russia could default on its debt repayments. Emerging economies are typically most at risk of debt default. Image: Bank of England

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