Russian authorities are alarmed that Russia is experiencing large-scale capital flight. However, as Vlast columnist Sergei Minaev notes, it is not clear what they fear more - the outflow or the influx of capital that took place several years ago.

Back at the end of May, the Russian authorities began to regularly talk about the rapid outflow of capital from the country in the first months of 2011: in January-April, the net outflow of private capital already amounted to about $30 billion. As the head of the Russian Central Bank, Sergei Ignatiev, said on May 26: “$30 billion - This is a very large number. I’m afraid that there will be an outflow in May, this process has dragged on, it’s difficult for me to explain.” Before this, the head of the Central Bank, speaking about what was happening, used the expression “strange process.”

Indeed, on June 6, the director of the balance of payments department of the Bank of Russia, Lidiya Troshina, announced: “In May, capital outflow was about $5 billion. The net outflow of capital through companies was much greater than through banks. The outflow for banks is very small. Thus, capital outflow for January --May amounted to about $35 billion."

For his part, Deputy Minister of Economic Development Andrei Klepach noted on June 8: “The outflow is still greater than we predicted.” Actually, we can recall that in 2010, the net outflow of capital turned out to be greater than the Russian authorities predicted: it was expected that it would be $22 billion, but in the end it turned out to be $35.3 billion. At the same time, in the fourth quarter, the net outflow amounted to $21.5 billion , that is, from October 2010 to June 2011, $56.5 billion flowed out.

Naturally, the Russian authorities still tried to find an explanation for what was happening. Speaking to State Duma deputies on June 6, Deputy Chairman of the Bank of Russia Sergei Shvetsov noted that capital outflow is proportional to the volume of export revenue. In turn, Sergei Ignatiev said: “The main reason for the outflow of capital is the not very good investment climate in Russia.” And he explained that he meant corruption, excessive administrative burden and the increased tax burden in 2011. Finally, Lidia Troshina presented the matter this way: “For many years in Russia there was a positive balance of the current balance of payments, and the Central Bank bought the currency coming into the country into its gold and foreign exchange reserves. It turned out that the current balance was a plus, and the reserves took over this plus in the form of currency purchases. Now that the currency policy of the Central Bank of Russia has changed and it does not buy back the positive balance of the current account, these funds must go somewhere else. That is, if the policy of the Central Bank is what it is now, then... There will be an outflow of us until the current account goes to zero or negative. Then, automatically, for some operations to take place, an influx of capital will begin.”

Someone, naturally, may ask: where is the capital flowing out of Russia now going? Sergei Shvetsov answered this question like this: “This could be the purchase of assets, the purchase of real estate, it could be anything.”

It should be noted that for some time the authorities of developing countries were truly horrified by the outflow of capital; they even used the expression not “capital outflow”, but “capital flight”. And they resorted to the most drastic measures to stop this flight.

Capital flight was mainly associated with political crises, the external debt crisis, the depreciation of the national currency against the dollar, as well as incredibly high inflation. In such conditions, everyone bought foreign currency and took it out of the country by any means. For example, in 1985, due to the debt crisis in South Africa and the catastrophic fall in the value of the rand against the dollar, capital flight from the country became so panicky that President Peter Botha banned the operation of the local currency exchange and the stock market for several days. But when the ban was lifted, the flight continued, and South Africa was eventually forced to default on its $22 billion in foreign debt and impose severe restrictions on foreign exchange transactions and the buying and selling of shares in local companies.

In Argentina in 1989, amid the external debt crisis, inflation reached incredible proportions: at the beginning of the year it was 33% per month, then 78%, then 114%, and then stabilized at 200% per month. It got to the point that in June 1989, supermarkets in large cities began to use a special computer program that automatically increased prices on all goods by 1% every four hours. Naturally, in such conditions, everyone hastily bought foreign currency and exported it from Argentina. To stop capital flight, the authorities tried all options for setting the exchange rate, but not a single clever option stopped citizens and businesses from purchasing currency. Eventually, Argentina's foreign exchange reserves fell to $100 million, and in order to somehow replenish them, the authorities decided to sell the Argentine Embassy building in Tokyo for $280 million.

Sometimes, during political crises, capital flight was observed in industrial countries. For example, before the spring student unrest of 1968 in France, the exchange rate of the franc was extremely stable, the inflow of capital into the country significantly exceeded the outflow, and the volume of gold reserves amounted to $7 billion. But student protests, as well as mass strikes, led to a deterioration in France’s foreign trade balance, causing investors to doubts that the authorities would be able to keep the franc from devaluing—and a panicked flight of capital began. Under the conditions of the currency system that existed in the world at that time, in which buying dollars for export meant buying gold (since the United States freely exchanged dollars for gold), the flight from the country of dollars bought for francs meant the flight of gold - and by the end of 1968, France had There are only $4 billion worth of gold left in reserves.

Actually, capital flight was typical for post-Soviet Russia. American researcher Bruce Parrott wrote in the late 1990s: “The modest influx of foreign capital contrasts with the significant amount of local capital that is leaving Russia in the form of “capital flight.” By the mid-1990s, this flight, according to some estimates, reached $50 billion Financiers, stockbrokers and ordinary citizens who transfer capital abroad are guided by exactly the same calculations and the same skepticism that force foreigners to refrain from large-scale investments in Russia. The export of capital is usually achieved by issuing false invoices for payment of imports, as well as other illegal methods. The scale of capital flight indicates the depth of the local problems that need to be solved in order to secure large investments in Russia; it also demonstrates the scale of progress that can be achieved if these problems are finally resolved."

A lot has changed in the world now. And developing countries are no longer struggling with the outflow of capital abroad, but, on the contrary, consider it a profitable investment in the context of economic globalization. The acquisition of assets and real estate in industrial countries by investors, say, from Middle Eastern countries or China, has reached such a scale that it has begun to cause concern among the authorities of industrial countries, who began to suspect the authorities of developing countries of artificially encouraging the export of capital.

As for Russia, it is now not even clear whether the authorities are concerned about the fact that Russian companies are withdrawing money from the country in large quantities to acquire foreign assets and real estate. It seems that they do not show strong dissatisfaction and do not talk about the unacceptable flight from Russia of dollars received from oil exports. However, for some reason they also do not express joy at the fact that these petrodollars are being profitably invested by Russian companies abroad. It would seem that not so long ago they were upset that Sberbank failed to acquire the Opel concern and thereby ensure a large-scale outflow of capital from the country. However, we note that now the authorities are expressing hope that at some point the capital outflow at the current level will still be replaced by at least a moderate influx of capital - it looks as if they would be happy if Opel were bought by Sberbank.

Depths of stormy outflow