Ministry of Finance (Russia) to issue special eurobonds for entrepreneurs. Nina Kozlova’s Comment for “Expert”

The Russian Ministry of Finance is about to issue special eurobonds for entrepreneurs who want to avoid the new US sanctions. Just to remind you, Vladimir Putin supported the idea as to foreign currency denominated bonds issued by the government to ensure anonymity for customers and settlements related to such bonds in the Russian banking system in late 2017. The new US sanctions are expected in late January - early February, and they will focus on Russian businessmen and officials.

Nina Kozlova

General Director of FinExpertiza

Foreign assets of our compatriots can be characterized as family capital used to purchase real estate, pay for kids' education, make family's current expenses, investments in a business abroad, and money exported abroad but working for Russian businesses of owners. Return of capital to the Russian Federation is primarily related to neither the amount of "free" funds of owners nor the redefining their purpose in moving funds abroad. Now the motive is usually one, i.e. ensuring safety of investments. Now the safety is undermined due to more US sanctions, which threaten freezing of bank accounts against some Russians, and deoffshorization planned for this year due to the launched exchange of tax data between Russia and other countries, including offshore financial centers popular among Russian companies. If such "risky" capital of Russians is estimated at three billion dollars according to the Ministry of Finance, then it is highly probable that the grounds for such settlements exist.