According to the Central Bank of Russia, in July, a group of 43 major exporting companies reduced currency sales on the exchange to a minimum over 4 years of observation – 2.2 billion US dollars.
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Decreased 4 times
Compared to June, the volume of export currency sold on the market for rubles decreased 3.5 times, compared to the same month last year – almost four times, and compared to the level two years ago – 6-7 times. For example, in the first half of 2024, exporters sold up to 12-14 billion dollars per month.
“There is a fundamental gap between the volume of export revenues and the volumes that currently actually enter the domestic market,” notes the chief analyst of “Finam,” Aleksandr Potavin.
The currency disappears somewhere, although export revenues themselves are growing – by 15 percent or 30 billion US dollars in the first half of the year, according to the Central Bank of Russia. The price of Russian oil – the main source of export currency – fell only 7 percent in July, from 63.52 to 59.02 dollars per barrel. But currency sales decreased by 71 percent.
Billionaires hide currency fearing asset nationalization
“During the period of a strong ruble exchange rate, exporters were allowed to hold currency abroad,” recalls A. Potavin. As early as August last year, the Russian government de facto abolished the mandatory export revenue sales norm, which was introduced in the fall of 2023 when the ruble exchange rate fell to 100 per dollar.
Initially, it was required to transfer 80 percent of currency revenues to Russian bank accounts and sell 90 percent of these funds. Later, the norm was reduced from 80 percent to 60 percent, then to 40 percent, and a year ago – to zero.
Now “exporters sell currency in minimal amounts, despite high oil prices,” notes A. Potavin.
Large businesses seek to hide money so that Russian regulators do not see it, fearing possible asset nationalization, sources closely connected with the Russian “elite” told The Washington Post (WP). Over the past year, the Russian Prosecutor General’s Office confiscated companies, factories, and ports worth 51 billion dollars from owners for the benefit of the state. And this is not the limit, a partner of one of Russia’s billionaires told the newspaper: “If the government needs money, Putin will simply seize the assets.”
Moreover, it is felt that “political power is becoming less stable” than it was, and this is “a time when it is better not to be visible,” said another WP source.
