CAPITAL FLIGHT GROWS AS POLITICAL UNCERTAINTY CONTINUES
By Kim Iskyan
Gazprom announced that it was indefinitely delaying additional investment in the Shtokman natural gas field in Arctic Russia.
Global oil and gas firm Total, which holds a 25% stake in the field, said it had not decided what to do with its interest, but in August, Statoil, which controls a 24% interest, wrote off its stake. Shtokman is estimated to hold 3.8 trillion cubic meters of gas.
The ministry of finance raised its inflation forecast to 7% for 2012 owing to rising food prices, strong loan growth and the inflation indexation in July of a number of public utility tariffs. Analysts speculate that the central bank will nonetheless resist raising interest rates, in part out of fear of derailing the economy, which is expected to slow from a 4.4% growth rate in the first half of the year.
The ministry of economics released a forecast calling for net zero outflows of capital in 2013 and said that it expects capital flight of $50 billion to $60 billion in 2012. As of the end of July, capital flight this year had already clocked in at $48 billion. Private economists speculate that capital flight, driven in part by domestic political uncertainty, could reach $80 billion to $100 billion this year. The ministry also forecast capital inflows of $30 billion in 2013, and $40 billion in 2014.