Servicing the Russian Federation’s Public Debt in 2026: Challenges and Opportunities

The relevance of this study lies in the fact that in 2026, the Russian Federation faces a challenging financial challenge: ensuring unconditional public debt servicing. It should be noted that over the past six years, budget expenditures (as a share of GDP) have increased, including due to defense spending. The share of budget revenues relative to the size of the economy (GDP) has declined. Under these circumstances, flawless coordination of budget, monetary, and debt policies is required. Against the backdrop of increasing anti-Russian sanctions, defense spending, and a growing budget deficit, coupled with rising borrowing costs, it is crucial to fi nd an answer to the question: under what conditions can the country effectively service its public debt? The purpose of this study is to fi nd an answer to the question: what macroeconomic, fiscal, and institutional conditions are necessary for the Russian Federation to fully and sustainably service its public debt by 2026? The novelty of these results lies in their substantiation that the Russian Federation possesses all the necessary capabilities to successfully service its public debt in 2026 (a moderate debt-to-GDP ratio, a sufficiently deep domestic market, and the presence of a financial buff er in the form of the National Welfare Fund), as well as in their identification of potential constraints and risks. The practical significance of these results lies in their ability to be taken into account when implementing measures to service the Russian Federation's public debt in 2026.