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Kremlin says monitoring report UK may limit Russian debt market access

Kremlin spokesman Dmitry Peskov

Russia is closely watching a report that British Prime Minister Theresa May may be considering limiting London’s role in marketing Russian debt to investors, Kremlin spokesman Dmitry Peskov said on Thursday.

British newspaper The Guardian reported on Wednesday that May had agreed to consider a ban on the City of London helping Russia sell government debt in the wake of the poisoning of a Russian former spy in England. Reuters has not been able to verify the report.

After the first known use of a military-grade nerve agent on European soil since World War Two, Britain blamed Russian President Vladimir Putin for the attempted assassination, and the West has expelled around 130 Russian diplomats.

Moscow, which has denied any involvement, warned that further punitive steps against it would be harmful for those who impose them.

Peskov, when asked about May’s reported proposal and a warning from U.S. ambassador to Russia Jon Huntsman that Washington could freeze Russian accounts in the States, said such steps, if made, would hurt international relations with investors.

“We are watching this very closely. Indeed it is a very important matter that probably concerns (these) countries’ image as reliable economic partners,” Peskov said of the UK and U.S. warnings.

“Of course such decisions cannot but harm these countries’ goodwill in terms of their relations with other investors. That’s why we are tracking and watching such statements very closely now.”

Deputy Finance Minister Alexei Moiseev made similar remarks earlier on Thursday.

“This would be bad not only for us but also for those investors who have bought all these securities. It’s not quite clear what they would do with all the securities,” Moiseev told reporters.

Still, there has been little sign of demand for Russian assets being seriously dented, while Russian firms’ plans to raise capital overseas remain on track.

Peskov told a conference call with reporters that Britain was a “rather unpredictable country in its relations with the Russian Federation.”

When asked about a suggestion that Austria could mediate between Russia and Britain in the case of the spy poisoning in England, Peskov said Russia needed “any roles, any voices that can help the British to see sense in this issue.”

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