- Cooperation improving with U.S., EU, S&P analyst Kraemer says
- Kraemer sees 'overlap in common interests' helping relations
President Vladimir Putin finding common ground with the U.S. and the European Union on fighting international terrorism may help remove sanctions against Russia and boost the country’s sovereign debt rating, according to Standard and Poor’s.
Russia and its former Cold War-era foes appear to be moving toward greater cooperation after the Paris terrorist attacks that killed at least 129 people Friday and the air crash in Egypt that killed 224 last month, Moritz Kraemer, managing director of sovereign ratings at Standard & Poor’s, told Bloomberg in an interview in Moscow. This cooperation may be positive for the country’s credit rating, he said.
Signs indicating that Russia’s standoff with the U.S. and its allies may be relenting have become more frequent in the wake of the attacks, highlighted by Putin’s meeting with Barack Obama at the G-20 summit this past weekend. French President Francois Hollande called on the two nations to forge a new alliance to destroy Islamic State. The EU is set to discuss early next year the extension of sanctions introduced over the conflict in Ukraine, whose crisis chilled relations between the Cold War-era foes to the worst in decades.
“The fact that we have Russia and the West on speaking terms again is a good thing,” Kraemer said. “It could lead to better cooperation and better cooperation could lead to reconsidering the sanctions. We are seeing a situation that seems to be more overlap in common interests. Before relationships improve they need to talk to each other -- we might be getting back to that point.”
Moody’s and S&P cut Russia to below investment grade this year following a slump in oil prices and sanctions imposed over Ukraine. S&P affirmed its BB+ rating of Russia last month, leaving the country’s sovereign debt on par with Brazil, Hungary and Indonesia a step below investment grade. The outlook remained negative, with the credit evaluator citing the risk of Russia’s fiscal buffers deteriorating faster than currently expected over the next 12 months.