Support The Moscow Times!

Q1 Capital Flight at $35.1Bln

Capital flight from Russia in the first quarter almost doubled from a year ago, eating into liquidity stemming from a year-on-year increase in the current account surplus.

Preliminary Central Bank data showed Wednesday that net private-sector capital outflows in the first three months of 2012 totaled $35.1 billion, up from $35 billion in the fourth quarter and $19.8 billion in the first quarter of 2011.

The regulator also revised its assessment of net capital flight in the whole of 2011 to $80.5 billion from $84.2 billion reported earlier.

Capital outflows in 2011 were attributed to lack of investment opportunities in Russia as well as to increased political uncertainty before a parliamentary vote in December and last month's presidential election in which Prime Minister Vladimir Putin secured a six-year Kremlin term.

The current account surplus — the broadest measure of the country's trade balance in goods and services — jumped to $42.3 billion in the first quarter from $30.8 billion seen a year ago, the Central Bank data showed.

Slower growth in imports contributed one-third of the additional surplus for the first quarter, which, however, was largely offset by the capital outflow, analysts at Alfa Bank said in a note.

Read more

Independent journalism isn’t dead. You can help keep it alive.

The Moscow Times’ team of journalists has been first with the big stories on the coronavirus crisis in Russia since day one. Our exclusives and on-the-ground reporting are being read and shared by many high-profile journalists.

We wouldn’t be able to produce this crucial journalism without the support of our loyal readers. Please consider making a donation to The Moscow Times to help us continue covering this historic time in the world’s largest country.