Election campaigns will not trigger high capital flight - CBR
MOSCOW. July 14 (Interfax) - Central Bank of Russia First Deputy Chairman Alexei Ulyukayev does not expect the election campaign to lead to high capital flight.
"I do not think high capital flight is possible. I think most political risks have already been taken into account by asset holders and I personally do not expect any unexpected turn of events," he said in an online interview on the Gazeta.ru website.
Election campaigns always have an impact on budget structure, social and investment obligations and the budget deficit, Ulyukayev said.
"The impact is always negative, this is a test of budget system stability. I believe our budget system has stability," he said.
Russia will have zero capital flight to the end of the year, he predicted.
Capital flight of over $30 billion in the first five months of 2011 was mostly the result of a lack of demand for ruble assets from exporters, who preferred forex instruments, Ulyukayev said.
Capital flight was also due to the general state of the economy and inflationary anticipation at the beginning of the year.
Dealers are less negative now "so our forecast to the end of the year is that the balance will be zero," he said.
Russia faces a huge task to improve its investment climate, which is not currently favorable for investors.
It was reported earlier that the Central Bank would keep its capital flight forecast for 2011 at $30 billion - $35 billion.