Foreign Direct Investment in Russia Triples in H1 to $55Bln – Putin

Author: us-russia
Comments: 0
Foreign Direct Investment in Russia Triples in H1 to $55Bln – Putin
Published 2-10-2013, 15:07
MOSCOW, October 2 (RIA Novosti) – Foreign direct investment in Russia’s economy in the first six months of this year reached nearly $55 billion, three times more than in the first half of last year, President Vladimir Putin told an investment forum Wednesday.

But while the president praised foreign interest in the national economy, he skimmed over the issues of capital flight and dwindling macroeconomic growth.

As a positive example of large-scale foreign collaboration, Putin highlighted a deal between the government’s Russian Direct Investment Fund (RDIF) and Abu Dhabi’s state-owned Mubadala Development Company to invest up to $5 billion in Russian infrastructure.

The Russian state will also continue to build up internal resources, including pension money and insurance and banking funds, Putin told the "Russia Calling” forum, hosted by state-owned VTB Capital, Russia’s second-largest bank.

"Special attention will be given to the creation of convenient [financial] instruments and to enhancing trust in the banking and financial sector,” he added.

In terms of gross domestic product, Putin said, Russia is close to becoming "Europe’s first economy and the world’s fifth economy.”

Last year Russia’s GDP was $3.373 trillion, compared with Germany’s $3.378, Putin said, citing the Organization for Economic Cooperation and Development, a global association that helps governments with economic issues.

However, Putin did not mention that Russia’s GDP in the first eight months of this year grew a meager 1.5 percent year-on-year and the seasonally adjusted month-to-month growth was basically zero, according to figures provided days earlier by Economic Development Minister Alexei Ulyukayev.

"There are no visible signs of change for the better,” Ulyukayev said Saturday at an international investment forum in Sochi. He urged Russians to prepare for a worsening unemployment situation due to economic stagnation.

Unemployment is expected to reach 6 percent next year, Ulyukayev said. The current unemployment rate is slightly above 5 percent.

Putin on Wednesday also skimmed over the problem of capital flight. Russia’s Economic Development Ministry recently increased its net capital outflow forecast for this year to $30 billion.

In February, the Central Bank’s then-chief Sergei Ignatyev made headlines when he claimed that a small group of well-connected individuals was responsible for almost half of Russia’s capital flight, which he estimated at $49 billion over the previous year.

Capital flight from Russia peaked at $133.7 billion in 2008, when the global economic crisis broke out, and declined to $56.1 billion in 2009. Capital outflow from Russia stood at $80.5 billion in 2011, up from $34.4 billion in 2010. Capital flight from Russia last year amounted to $56.8 billion.

 

RIA Novosti

Comments: 0
Experts' Panel
Any advice to Trump?
All those who have contributed to the Trump - Pence "Make America...
Any advice to Trump?
Top
popular in the journal
Eastern Economic Forum,...

Eastern Economic Forum,...

The 4th Eastern Economic Forum which held its plenary session on Wednesday, 12 September and heard important addresses from its host, Vladimir Putin, and from a ...
The US Must Engage With Russia

The US Must Engage With Russia

Real dialogue is necessary for nuclear-arms reduction
Trump and Erdogan

Trump and Erdogan

In my last essay on how Donald Trump is remaking U.S. foreign policy, I mentioned that the overriding interest of both his many foes and his few supporters has been with ...
New Movie \"Active Measures \"...

New Movie \"Active Measures \"...

If you believed Saddam Hussein had chemical weapons, this movie is for you. If you're an ideologue on an anti-Russian bender, you'll find this movie intoxicatingly ...
US fallacy of pitting Russia...

US fallacy of pitting Russia...

Ever since the end of the Cold War, the pundits and policymakers in Washington have suffered from raging attention deficit disorder. New fads and fantasies have ...