Lord Dreadnought (lorddreadnought) wrote,
Lord Dreadnought

Russia lost $1 300 000 000 000 in illegal capital outflows.

Global Financial Integrity organisation have found that there was massive flight of illegal capital in the years immediately following the formation of the Russian Federation on December 25, 1991.

Over the period 1994–2012, Russia lost US$1.3 trillion in illicit capital outflows. The seismic shifts involved in the dilution and shedding of central controls and in weak institutions trying to find their feet in the new order amid economic and political uncertainties continued to drive illicit flows from the country. Outflows of such capital increased from an average of US$35 billion per annum in the mid-1990s to US$71 billion per annum in the 2000s, and reached a startling average of US$141 billion in the final three years of this study (2010–2012). See Dev Kar and Sarah Freitas, Russia: Illicit Financial Flows and the Role of the Underground Economy (Washington, DC: Global Financial Integrity, 2013), 30–31, table 10, box 2.

As a share of GDP, illicit outflows remained fairly steady, averaging 8.0 percent of GDP in the period 1994–1999 and 8.4 percent in the period 2000–2012 when the economy grew much faster, partly as a result of higher oil exports.

A fuller picture of the role of illicit flows in driving the underground economy emerges if we consider both outflows and inflows. Over the period 1994–2012, cumulative illicit outflows totaled US$1.34 trillion, while total illicit flows (outflows and inflows combined) totaled US$3.27 trillion. Fully 87 percent of illicit outflows—and 99 percent of illicit inflows—from 1994 to 2012 were due to the misinvoicing of trade, confirming its importance as the most important mechanism for illicit financial flows.

Source: http://www.gfintegrity.org/wp-content/uploads/2015/09/Ford-Book-Final.pdf

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