Part 6/11:
Russian authorities disguise the true debt levels by shifting expenses, such as military costs, into regional budgets rather than the federal balance sheet. This tactic makes the overall debt appear smaller than it actually is, allowing the government to avoid immediate repercussions while accumulating vulnerabilities.
- Limited Borrowing Capacity:
Due to distrust from international creditors, Russia struggles to borrow internationally, as investors are wary of lending resources to a government lacking in transparency and with a questionable track record. Consequently, Russia relies heavily on internal borrowing mechanisms and collateral, primarily gold, which are now failing due to decreasing reserves and limited liquidity.
- Gold Reserves Under Strain: