Find money for RDIF capitalization, Putin says
MOSCOW. Sept 25 (Interfax) - Russian President Vladimir Putin has told Prime Minister Dmitry Medvedev to take steps for the additional capitalization of the Russian Direct Investment Fund (RDIF).
Per the text of the September 19 instructions, which are cited by Finmarket, the task could be met in two ways: by the annual allocation of 62.6 billion rubles from the federal budget in 2012-2015 for getting closed mutual funds from Vnesheconombank (VEB), or by the placement with VEB of the same amount using National Welfare Fund monies.
A decision needs to be made by October 1.
The issue of RDIF capitalization was raised by the head of the fund's supervisory council and First Deputy Chairman of the Central Bank of Russia Alexei Ulyukayev. At the end of last month he sent a letter to First Deputy Prime Minister Igor Shuvalov cautioning that if an annual 62.6 billion rubles in subsidies were not included in the budget for 2012-2015 "the fund's activities will be virtually suspended." That, he said, "will undermine Russia's authority as to initiatives to the international investing community announced by the country's leadership."
Ulyukayev said that when the RDIF was created a decision was initially made concerning the fund's capital in the amount of $10 billion with the addition of $2 billion a year. The fund cannot be a quality partner for leading world players or ensure the needed amount of significant projects at less than that, the letter says. World funds that partner with the RDIF have decided to co-invest based on that $10 billion amount, Ulyukayev said.
The recoverability of RDIF funds "differs beneficially from unrecoverable budget spending," Ulyukayev said in his letter.
Ulyukayev directed Shuvalov's attention to the fact that the RDIF supervisory council had approved at a June meeting a request for an annual 62.6 billion rubles for fund capitalization.
The letter refers to deals the RDIF has already carried out with an evaluation of the positive effect, cites Putin and foreign investors' statements about the fund's activities, and a letter from VEB Chairman Vladimir Dmitriev to Finance Minister Anton Siluanov requesting the earmarking of budget funds.
As of September 2012, the RDIF was studying 53 projects with a combined value of $11 billion, the fund's head, Kirill Dmitriev, earlier said. Funds already present in the fund's capital are sufficient until the first quarter of 2013, Ulyukayev said.
