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The Interpreter
@Interpreter_Mag
Russian-to-English translation journal, with original analysis and commentary on Russia's foreign & domestic policy.
Interpreter_Mag
Russia Update: July 10, 2015

Publication: Russia Update
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The Interpreter
@Interpreter_Mag
Russian-to-English translation journal, with original analysis and commentary on Russia's foreign & domestic policy.
Interpreter_Mag
Suspect in Nemtsov Murder Who Died in Grenade Blast Had Government Plane Reservation
Beslan Shuvanov, the Chechen suspect who died in a grenade explosion when police came to his door last year, was discovered to have had a government flight reservation to Moscow, Rosbalt.ru and Media Zone reported, citing a source in law-enforcement.

Translation: Shavanov, suspect in Nemtsov Murder killed during detention, flew to Moscow on a government reservation.

After the murder of opposition leader Boris Nemtsov on February 27, police arrested the chief suspect in the murder Zaur Dadayev, a former officer of the Chechen Interior Ministry's troops, and his associates. One of them, Beslan Shuvanov, either missed when he tried to throw a grenade at police, as his relatives claim, or committed suicide, as law-enforcers say.

Now Shuvanov has been found to have flown to Moscow on February 26. It turned out that when he came to the airline window at the airport on February 25 saying he needed to fly out immediately, all the tickets were sold out. He then called the Moscow office of Grozny-Avia to ask about tickets set aside by the Chechen government which are not for sale to the general public and are held for government officials. He was able to get one of these special tickets and leave February 26 only because someone intervened on his behalf. It will now be difficult to determine who that was since he was killed, said the source.

"Shavanov's behavior indicates that the organizers and perpetrators had determined several days in advance that the attack on Nemtsov would be made on February 27," said the source.

A witness who worked for Ruslan Geremeyev, who is also wanted by police in the murder investigation, said the planning of a major crime began back in November 2014.

The source said that the investigation had increasingly come to the conclusion that the murder of Nemtsov was not an emotional crime provoked by Nemtsov's support of the Charlie Hebdo journalists, as the Investigative Committee's spokesman Vladimir Markin said soon after the assassination. The evidence collected to date shows the murder was being planned even before terrorists attacked the office of Charlie Hebdo in Paris on January 7.

The perpetrators found that Nemtsov was difficult to follow as he often had a "chaotic" schedule and would often take the metro; they would follow him by car but refused to go down in the metro. That meant they often lost their "target" and it took months to fill the orders of the contractors  of the murder, who remain unnamed in the investigation. They knew that Nemtsov was to appear on the air live on February 27 on the radio station Ekho Moskvy, as it was announced several days in advance. Shavanov who was in Grozny at the time, received the order to go to Moscow immediately.

But the Chechen suspects lost Nemtsov once again after his show on Ekho. As they were given orders to act that day, they put tails at his home and office and finally caught him going to GUM, the shopping center on Red Square, where he had a date with his girlfriend Anna Duritskaya, in the Bosco cafe. Then they were able to trail him finally and kill him on the bridge near the Kremlin.

-- Catherine A. Fitzpatrick


The Interpreter
@Interpreter_Mag
Russian-to-English translation journal, with original analysis and commentary on Russia's foreign & domestic policy.
Interpreter_Mag
Russia has Lost $52 Billion in Capital Outflow Already This Year

Already $52.2 billion in capital has fled Russia this year, and it looks slated for $100 billion by the end of the year, Gazeta.ru reported.

Gazeta.ru used the term "capital outflow" rather than the more dire "capital flight" to describe the issue, but it may amount to the same thing. Last year, Forbes reported that capital flight reached $151 billion, double the figure for 2013.


According to estimates from the Central Bank of Russia, the flight of capital in the first quarter of 2015 was estimated at $20 billion, which was 38.5% less than the first quarter, which was $32.5 billion. About $70-80 billion will have left Russia by the end of the year. Then, according to the Ministry of Finance, the peak of payments of external debts by exporters which will come in the last quarter of this year, could accelerate the outflow of capital and may push the total up to $100 billion.

"This is significantly lower than the estimates in the beginning of this year; there was talk of about $120-130 billion then," said Finance Minister Anton Siluanov, who forcast that the total would reach $90 billion by the end of this year.

Andrei Klepach, cihef economist of Vneshekonbank (VEB) said:

With great likelihood, the strengthening of the ruble played a role, which lowered the attractiveness of assets in foreign currencie, and also the local minimum of payments on the external debt. Unfortunately, both these factors are temporary, and in the second half of the year the outflow of capital could once again accelerate.

The Central Bank says companies will have to pay $28 billion in foreign debts. But according to Andrei Valejo-Roman, the chief portfolio manager at Kapital, the companies did not believe this was a problem, as they were already buying foreign currency to pay September's debts, and were not so indebted in any event. Only in the second half of 2016 and beginning of 2017 could problems start, but that's in the long-term perspective.

 A key component of capital outflow is pay-offs of corporate debts, said Anton Soroko, an analyst with Finama. They cannot get new loans until they pay off the old ones. Some of the capital leaves to offshore payments but returns in the form of direct and portfolio investments.

Russia has tried to stem the outflow by have an "amnesty" for investors abroad to repatriate their funds, but it was too early to predict the results, said Soroko. Only two or three years from now would the effects be felt.

This might be another way of saying that there have not been any major takers of the offer so far.

Russia has tried to stem the outflow by have an "amnesty" for investors abroad to repatriate their funds, but it was too early to predict the results, said Soroko. Only two or three years from now would the effects be felt.

Even so, the exit of capital was predicted to be lower than last year when Russia launched the war on Ukraine, sanctions were imposed and the ruble crashed even as the price of oil fell.

With the preservation of the current regime of sanctions and the price of oil in the $50-60 per barrel corridor, the outflow will be $110-$120 billion," said Anton Tabakh, director of regional ratings for RusRating.

-- Catherine A. Fitzpatrick

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