Why capital flees from Russia

To the disappointment of the organizers of the forum in St. Petersburg, has violated the current economy in recent years and has not brought the tradition of gift that you can proudly show the guests. Change of outflow of private capital inflows did not happen. In the first quarter of Russia left $ 21.9 billion in April - $ 7.8 billion in May - another $ 5 billion, the Central Bank revised its prediction: he no longer expects close to zero balance on the basis of the year, and instead expects to reach the outflow at $ 30-35 billion which means that in the remaining months of 2011 cross-border capital flows have roughly offset each other. It is noteworthy that during the five months of capital left in the background of a very favorable commodity markets. According to the Ministry of Economic Development, in January - April, the average price of Urals oil was $ 106.3 per barrel. The Government is only comforted by the fact that the spring outflow somewhat weakened. In the first quarter, especially in January - February, the capital were taken together and the companies and banks. The data suggest that the balance of payments, the non-financial private sector increased its foreign assets to $ 19.3 billion, financial - to $ 10 billion, a fact which, paradoxically, contributed to this oil, appreciates sharply against the background of turmoil in the Middle East and North Africa. As explained by then chairman of the Central Bank Sergei Ignatyev, the exporters 'no time' to convert into rubles abundant streams of revenue and come to their accounts in Russian banks in currency deposits placed abroad. However, in March, the company began selling adhered petrodollars, the balances on their markedly reduced foreign currency accounts, and increase banks' foreign assets slowed down. As the director of the Central Bank's balance of payments Lydia Troshin, a significant portion of April's outflow of capital has provided a market participant - the Savings Bank. Its foreign assets for the month increased by more than $ 5 billion in May, the same funds taken out of the company. Served in a run. If at the end of last year building up foreign assets theoretically could be explained by speculative pursuit of profit (if the ruble has fallen significantly), as well as the revival of the market M & A, in the first quarter of doubt no more: we are talking about capital flight. Economists believe that much of the increase in foreign assets - loans it's offshore shareholders of Russian business. "Hardly anyone would pursue these transactions short-term gains and tried to earn in a course, as the Russian currency rose in price, and with a speculative point of view it made sense to stay in rubles, - says the chief economist AFK" System "Eugene Nadorshin. - Apparently, in April - May, this process is not stopped, and the second quarter of net outflows can be comparable to what was in the first. " Another interesting point is that the net capital outflow took place against the backdrop of increasing the volume of private sector liabilities to nonresidents: the companies are in the first quarter rose to $ 11.2 billion, the banks - $ 2.6 billion, "The amount of planning required external repayments for the first five months of this year was estimated at $ 52 billion, taking into account interest payments - says a leading analyst of Research Bank "Petrocommerce" Dmitry Harlampiev. - Over 30% of redemptions were offset by new borrowing. However, was recorded a net outflow of capital, which is about two-thirds have provided non-financial companies. " Perhaps, under conditions of relatively low interest rates and the ruble ruble liquidity overhang of external debt was substituted internal expert suggests. You can certainly try to write off the lack of enthusiasm of investors for the risks associated with the external environment: because no one can guarantee the preservation of oil prices at current levels for the stabilization of the situation in North Africa and the Middle East, as well as after the termination of the second round of quantitative easing (QE2 ) U.S. Federal Reserve. However, a more plausible version is called the head of the Central Bank, - "not very favorable investment climate in Russia." Even if you do not take into account the chronic weakness of institutions, the factors that discourage hunting business to build the new plans are sufficient. We can distinguish two fundamental uncertainties. The first relates to the tax regime: the government has not yet decided the fate of contributions to social funds at least for the next few years. The second - the political, related to the upcoming elections. On what will be new information on these two issues, depends largely on the direction and intensity of capital flows in the coming months. Do not forget that in the third quarter is traditionally account for a large dividend payments, and before some of them were sent to the owners of the business reinvestment, providing Russian capital inflows. But this year, this channel may dry up if the situation becomes clearer, or political decisions do not satisfy investors. What's next? Interviewed analysts tend to assume that the Central Bank forecast, even in an updated form, is too optimistic. More likely scenario of annual outflows of $ 50 billion, according to Alfa Bank. "Slowing outflows in May may reflect slowing of business activity as compared to April due to the holiday season" - write a review analysts Natalia Orlova and Dmitry Dolgin. "Restoring the active inflow of capital is unlikely to stabilize balance at close to zero, or small local flow is possible, - Dmitry Harlampiev cautious. - However, for the year, taking into account the dynamics of the first five months, with high probability will be recorded net outflows. " According to Evgeny Nadorshin, most reasonable to expect a net capital inflow in the fourth quarter: it is likely that by the time the situation related to the upcoming elections to become more transparent and obvious. "Everyone is nervous about their outcome, will take those positions that are comfortable for them, respectively, the outflow of capital dries up, - the chief economist predicts AFK" System ". - And then we have the traditional components of the flow in the form of loans and foreign direct investment. But the fourth quarter did not outweigh the first three even close, so together we can get a very substantial net outflow for the year and compared to other BRIC countries will not look too attractive. "