Russia Inc sitting on a multi-billion debt time bomb

Moscow: Russian companies are sitting on a multi-billion dollar debt time bomb after allowing overseas borrowings to rise since April, heedless of default fears that dogged them in early 2009.

Bankers say a failure to complete restructurings may hamper Russia's ability to borrow in the future and the absence of clearly defined negotiation guidelines between Russian and western lenders raises the risk of future defaults.

Currency and commodity markets have been unexpectedly benign for Russia since June, helping to stave off a widely forecast debt disaster, but Dubai World's debt woes have served as a reminder that the problem has merely been postponed.

Text: Reuters

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