Amid the heated race within the European Union over the extension of the guillotine of sanctions against Russia, the capital has no choice but to flee.
As if it is systematic European financial racism against all that is Russian or it follows in economic activity, or even assets of wealth.
The repercussions of the Russo-Ukrainian war on the global economy are great, given the sanctions imposed on Russia, in addition to creating a kind of tension worldwide, which will lead to capital flight and fluctuations in global stock exchanges in various transactions , as well as the impact on intra-international trade, as it increases the The lowest estimate of shipping insurance rates, especially in European countries.
While some countries are working to provide wide administrative and tax facilities to attract capital fleeing the battle zones, large industrial and commercial companies are recreating their priorities in the face of a new world that does not seem to be returning to its former era, even if the guns fall silent at any moment.
Isolation of Swift .. the largest guillotine
Britain was one of the most enthusiastic about completely isolating Russia from the global “Swift” system, and British Foreign Secretary Liz Truss pointed out that her country was not just aiming to rid Russia of “Swift” do not separate, but rather to establish alliances in the fields. of economics and security around the world, to tighten isolation on Russia, while there is talk of the British Tax Authority’s intention to cancel its recognition of the Moscow Stock Exchange, leading to increasing Russia’s isolation from global financial markets, and capital pressures to leave Europe.
Russia is the second country to be threatened with exclusion from the SWIFT system after Iran in 2021, which will make it difficult for financial institutions to complete their transactions, whether money is sent to or from Russia, in addition to stopping commercial overpayments. and abroad.
Russia is hit hard because it is the number 2 Swift country with its 300 financial institutions within Russia, and Russia relies heavily on Swift for its billions of dollars worth of hydrocarbon exports.
The separation of Russian banks from Swift will reduce the volume of international transactions, lead to currency fluctuations and massive capital flight abroad.
The very rich were hit the hardest
The great Russian empires, some of which are linked to the Russian leadership, have suffered losses estimated at $ 83.0 billion, such as Gennady Timchenko and Alisher Usmanov and the owners of the Alpha Group “Mikhail Friedman” and “Peter Avin” , the steel magnate. (Alexey Mordashov) and Roman Abramovich are one of the most well-known billionaires, owning Chelsea Football Club, worth about $ 2 billion, and other assets, including a stake in steelmaker Evraz Plc, energy companies Velocys Plc and AFC Energy Plc.
To escape EU sanctions, Usmanov’s Airbus A340 left Munich and left EU airspace. As for (Vajit Alekperov), the head of Lukoil PJSC, his fortune has decreased by about $ 13 billion this year.
French economist Thomas Piketty, director of studies at the École des Hautes Etudes en Sociale Sciences (EHESS), said the total wealth of Russians held by tax havens abroad is estimated at about $ 800 billion, and by few people. not. hundreds, and the French scientist confirms that they consider London one of their favorite cities to live and spend their money.
In terms of investments, even before the recent tensions between Washington and the United States over Ukraine, foreign investors began a flight of Russian assets and reduced the size of their investment portfolios on the Moscow Stock Exchange.
In turn, US President Joe Biden said in mid-April 2022, “These rich people and their families cannot keep their money and assets in the United States and Europe and keep hundreds of millions of dollars in yachts.”
Assets of more than 30 Russian billionaires seized
According to (Global Economy) data, the total value of incoming foreign investment to the European Union amounted to 370 billion US dollars, while the value of external investments amounted to almost 250 billion US dollars, during the same year.
Several European countries and the United Kingdom have announced the confiscation of assets belonging to Russian businessmen in response to the Russian war against Ukraine, which has affected more than 30 billionaires, led by Roman Abramovich, the owner of Chelsea FC, who recently offered for sale. .
According to ING data, Russia is already suffering from a high rate of flight of foreign investment, as the money that fled the Russian market in the third quarter of last year amounted to $ 33.9 billion, and the company expected it to $ 69.5 billion would increase by the end of 2021.
Transfer of confiscated Russian assets to Ukraine
The White House on Thursday proposed using assets confiscated from Russian oligarchs to compensate Ukraine for damages caused by Russia’s war in Ukraine.
The White House said in a statement that it would “allow the transfer of all proceeds from the looted assets to Ukraine to compensate for the damage caused (to Ukraine) as a result of Russian aggression.”
This proposal represents an escalation in the Western position against Moscow, and is expected to be accompanied by the announcement by US President Joe Biden on Thursday of a new major military aid package for Kiev.
In terms of sanctions, European Union countries have so far confiscated more than $ 30 billion worth of Russian assets, including some $ 7 billion in oligarchy-owned luxuries (yachts, works of art, real estate and helicopters), according to the White House.
As for the United States, it has “imposed sanctions on ships and aircraft worth more than one billion dollars and prevented their movement, as well as frozen hundreds of millions of dollars of Russian elite assets in US accounts.”
Spain this month approved a US request to seize a $ 90 million luxury yacht owned by Russian billionaire Viktor Vekselberg, who is close to President Vladimir Putin.
Safer and more attractive investment destinations
What is currently happening against Russian businessmen on the part of the majority of European Union countries will recalculate on new and existing investments in the old continent.
This means that capital will be ready to leave the bloc countries and look for areas where financial racism is not common, as emerging markets can be an expected kiss for this fleeting liquidity.
On the other hand, capital did not wait for the end of the war to leave European countries, as Turkey and the UAE have changed into preferred destinations for many investors from Russia and others since the beginning of the Russo-Ukrainian war.
A group of Russians and Turks spoke of some having transferred their refuge to Russian money-transferring companies operating in Turkey, cryptocurrency and thousands of dollars in cash through airports.
The Turkish government has announced that it will not allow the flow of Russian money, not even from the oligarchs, if it is legal, given the country’s need for foreign exchange following an economic crisis last year that caused the Turkish lire about 45 percent of its value against the dollar in less than three months.
At an international conference held in Doha on March 26, 2022, Turkish Foreign Minister Mevlut Cavusoglu said: “If you mean the oligarchs can do any business in Turkey, of course yes, provided it is legal, but if it is contrary to international law, then it becomes It’s another matter. “