RUSSIA: Russian Central Bank Governor Elvira Nabiullina says the bank will not introduce capital controls if oil falls to $60.

Record ID: 567132

  • Title: RUSSIA: Russian Central Bank Governor Elvira Nabiullina says the bank will not introduce capital controls if oil falls to $60.
  • Date: 2nd October 2014
  • Summary: MOSCOW, RUSSIA (OCTOBER 2, 2014) (REUTERS) WIDE OF VTB CAPITAL FORUM "RUSSIA CALLING" (SOUNDBITE) (Russian) RUSSIAN CENTRAL BANK GOVERNOR, ELVIRA NABIULLINA, SAYING: "It seems to me it is very important to understand that the challenges we are facing are structural and long-term.That's why continuity in politics - that's what Alexei Valentinovich (Ulyukayev, Russian minister of economic development) started with - is a very important factor. Continuity and flexibility at the same time." WIDE OF FORUM IN PROGRESS (SOUNDBITE) (Russian) RUSSIAN CENTRAL BANK GOVERNOR, ELVIRA NABIULLINA, SAYING: "Which principles we build our policy on? The first one is - no restrictions on capital movements. We consider it an achievement of the economic policy of the previous period and giving up this achievement may throw us many years back ." WIDE OF FORUM IN PROGRESS (SOUNDBITE) (Russian) SBERBANK PRESIDENT, GERMAN GREF, SAYING: "I don't want to queue in an old Soviet shop, I want to come to a modern Soviet "Magnit", built by modern Russian manager, or to X-5 retail, where service is great and there is control over goods quality, etc..." WIDE OF FORUM IN PROGRESS (SOUNDBITE) (Russian) SBERBANK PRESIDENT, GERMAN GREF, SAYING: "Investment climate, motivation of people...one cannot motivate people like in the Soviet Union - with Gulag (labour camp), this motivation is short-lived and it doesn't work. People cannot come up with creative products under the conditions when they do not understand current economic policy and business climate." WIDE OF FORUM IN PROGRESS
  • Embargoed: 17th October 2014 13:00
  • Keywords:
  • Location: Russian Federation
  • Country: Russia
  • Topics: Economy,Politics
  • Reuters ID: LVA3TJNLDRDHWIL4I3L847K64W0A
  • Story Text: The Russian Central Bank will not introduce restrictions on cross-border capital and currency movements in its worst-case scenario that envisages oil prices falling to $60 per barrel, the bank's governor, Elvira Nabiullina, said on Thursday (October 2). She stressed that despite economic challenges Russia is facing because of sanctions the country's financial and economic course will not undergo rapid changes, but will remain flexible.
    "It seems to me it is very important to understand that the challenges we are facing are structural and long-term. That's why continuity in politics - that's what Alexei Valentinovich (Ulyukayev, Russian minister of economic development) started with - is a very important factor. Continuity and flexibility at the same time," said Nabiullina addressing audience of the VTB Capital Russia Calling investment forum.
    Russian officials have been at pains to dismiss the idea that Western sanctions could cause much damage to the economy, but analysts are turning increasingly pessimistic on Russia's economic prospects, predicting growth of just 0.3 percent this year.
    Coupled with slowing investment and soaring capital flight, tighter lending conditions could further constrain growth.
    "Which principles we build our policy on? The first one is - no restrictions on capital movements. We consider it an achievement of the economic policy of the previous period and giving up this achievement may throw us many years back," Nabiullina said.
    President of the state-run Russian lender Sberbank German Gref told forum participants he does not want Russia to return to the Soviet past.
    "I don't want to queue in an old Soviet shop, I want to come to a modern Soviet "Magnit", built by modern Russian manager, or to X-5 retail, where service is great and there is control over goods quality, etc...", said Gref addressing participants of VTB Capital forum.
    "Investment climate, motivation of people...one cannot motivate people like in the Soviet Union - with Gulag, this motivation is short-lived and it breaks. People cannot come up with creative products under the conditions when they do not understand current economic policy and business climate," Gref added.
    Russia's top lender, Sberbank, faces rising borrowing costs and a squeeze on its margins after being included in the latest European Union sanctions over the Ukraine crisis.
    In its heaviest penalties on Moscow over the conflict in Ukraine, Brussels has banned all EU nationals and companies from buying or selling new bonds, equity or other financial instruments with a maturity of more than 90 days issued by five major state-owned Russian banks or those acting on their behalf.
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