/ world today news/ We already wrote that the export of capital from Russia in January-August amounted to 59 billion dollars. Let’s analyze this figure in more detail.
Also, if we look at the third quarter, then we get a record here. In the third quarter, 33.6 billion dollars were exported. This is 4 times more compared to the same period last year and 6 times more than in the second quarter of 2021.
At the end of 12 months, accumulated capital outflow amounted to $69.5 billion. Moreover, this amount will continue to grow.
The only positive point in the outflow of capital can be a situation where companies repay foreign debt. They send currency to repay the loans, which is included in the capital flight statistics.
However, if we look at the structure of current exports, then there is no repayment of external debt. On the contrary, external debt increased in all three quarters. It reached nearly $500 billion and totaled $489.2 billion (+21.9 billion YTD).
Capital flight now consists mainly of direct investment in foreign companies, which in effect means withdrawing profits.
For the same nine months, the surplus on the current account amounted to 82.2 billion. From this amount, we deduct the outflow of capital in the amount of 59 billion. It comes out to 23.2 billion.
The central bank buys currencies in the domestic market for almost exactly the same amount within the budget rule. We will clarify here that the purchase of foreign currency under the budget rule does not count in capital outflow. This is 100% information that the author of these lines specifically checked with the relevant departments.
So it turns out that the entire positive effect of the current account surplus is offset by offshore oligarchs and systemic liberals. The economy does us no good here.
And here we can say “thank you” to Alexei Kudrin, who in the 2000s achieved maximum simplification of the unhindered cross-border movement of capital. Moreover, he is proud of it, calling the passage of the corresponding law in 2006 one of his main achievements.
Russia urgently needs to impose restrictions on capital exports. This can be done without a fundamental change of legislation.
Even within the framework of existing legislation, it is sufficient to review double taxation agreements with offshore companies and introduce a 30% tax on capital exports. China does about the same. Beijing makes money work within its economy.
It is also necessary to revise the basic parameters of the budget rule. This mechanism in itself is not bad. But only if it is used as a reallocation of resources.
First, funds are withdrawn from the economy, but are almost immediately invested in promising development projects that become a growth engine for the entire economy.
This is effective. Systemic liberals introducing the budget rule partly with the same argument and justify its necessity.
It is said that it is necessary to accumulate an amount equivalent to 7% of GDP and only then invest in the economy. As you can see, now they want to raise liquidity from 7% to 10% of GDP.
So in this direction the situation is quite sad.
Translation: V. Sergeev
#economy #Offshore #oligarchs #systemic #liberals #discounted #effect #high #oil #prices
