Putin Lagarde IMF
© Michael Klimentyev / RIA Novosti
Russian President Vladimir Putin and IMF Managing Director Christine Lagarde during their meeting on the sidelines of the G20 summit in Antalya, Turkey, November 15, 2015.
Putin's supposed "offer" at the G20 to restructure the $3 billion debt Ukraine owes Russia has been universally misunderstood. It was not a real offer at all.

Firstly, it was not made to Ukraine - which is the country that owes the money - but to the IMF's Christine Lagarde. Secondly the "offer" is conditional on the IMF - or the US or EU - guaranteeing to pay Russia the money if Ukraine defaults. On that basis Putin said Russia would accept payment in instalments, each of $1 billion, payable over 3 years. Ukraine would however continue to pay interest.

If the offer were accepted Russia would get all its money - either directly from Ukraine or from the IMF or US or EU - plus interest on top, only over 3 years instead of in December. Putin cheekily pointed out that if Lagarde is so sure Ukraine is about to become solvent, giving Russia a guarantee should present no problems.

In reality - as Putin well knows - there is no chance the IMF or the US or the EU will ever give Russia such a guarantee. In the case of the IMF it is questionable whether it is legally able to. In the case of the US and EU doing so would be politically impossible.

Beyond that - as Putin knows - neither Lagarde nor anyone else seriously believes Ukraine will be solvent in a year's time or indeed any time soon. That rules out anyone giving any guarantees for Ukraine's debt. Putin's "offer" was intended to show that, whilst also showing Lagarde up.

Comment: Given the stress of picking his way through the wolves den, one can't blame Putin for a little nose-tweaking, especially when the receiver richly deserves it.

Lagarde asked Putin to postpone payment of the debt for a year, telling him something she doesn't really believe, which is that Ukraine in a year will be solvent and able to pay the debt. Putin fired back that in that case Lagarde should have no trouble guaranteeing it.

There are no reports of how Lagarde reacted. Probably she was embarrassed and quietly furious. The episode in fact shows Putin at his most quick-witted and mischievous. It is also another example of why the pompous and self-important - and in this case dishonest - grandees of the West, of whom Lagarde is one, find dealing with Putin so infuriating.