Actuality March 24, 2008

   Net capital outflow

from the Russian Federation (RF) totaled $20 bln, although at the world financial market took place the situation worsening.

However, it did not affect much the stability of

the Russian economy and its banking system as considers the Vice Prime Minister and the Minister for finance of RF Alexander Kudrin.

   When the Russian financial system collapsed in 1998 the outflow was lower, he said. "My job at the Minister for finance post within the last eight years was to take into account the one-sided dependence on oil, gas and high oil prices", he reported. According to him, it had been necessary to accumulate such stability that the Russian banking system would not collapse in terms of $20 bln or even $80 bln capital outflow.

Mr. Kudrin explained that the speculative capital inflow to Russia was partly related to the errors, which had done the market attractive for speculators.

   "For example, within the last eight years the Russian currency has consolidated at 80% by the basket of currencies.

It is the very strong consolidation for any capital movements and for the Russian business", he explained. Moreover, credit rates at the Russian internal market are 10-12%, and that is substantially higher, than in the West. "All comers who wish to gain the profit easily within one or two years gather to this ruble consolidation and to these rates at the internal market", Mr. Kudrin explained.

   According to Alexander Kudrin, for the last two months the inflow of population deposits to the Russian banks has decreased exactly in terms of inflation.

And the population began to trust the ruble less.

"For the last two months the majority has converted money into euro and has left a dollar, and not always trust the ruble", he added. According to him, on the world crisis background the Russian Federation reserves did not lose their cost, but grew. "We invested these facilities into securities nominated in euro, dollars and pounds, so that these securities even grow on the world crisis background", said the Minister for finance.