New year brings new hopes

Such forecast was presented by analysts of the British Center of Economic and Business Researches (CEBR). Meanwhile the Russian Federation is on the ninth place. According to the experts of Ministry for Economic Development and Trade, the Russian gross national product in 2011 has grown 4,5 %. By 2012 three world economy leaders will be steady: the USA, China and Japan will keep current positions. Experts give special attention to Brazil. In 2011 the country had the sixth position in the rating of the largest world economies, for the first time leaving Great Britain behind. It is indicative that one of BRIC developing countries has overtaken the developed economy of the European Union. In 10 years Brazil will keep current position in ratings. However by this time another BRIC country — India — will jump five positions upwards and will enter top-5, having overtaken such European giants, as Germany, Great Britain, France and Italy.

In the coming year changes in the value added tax are expected in a number of the European countries. The highest level of VAT in Europe is in Hungary. But other European countries catch up with it and in 2012 have already declared the VAT increase. So Cyprus originally declared VAT increase from 15 % to 17 % since January 2012. However, introduction of the new standard VAT rate is a little postponed and will come into force since the first of March, 2012. The Czech Republic will increase the lowered rates of the VAT this year from 10 % to 14 %. France raises the lowered rates of the VAT from 5,5 % to 7 %. As it was already mentioned Hungary increases standard VAT rates from 25 % to 27 %, since the first of January, 2012. It will be the first iEuropean country that stepped a 25 percent boundary. Ireland increases the standard VAT from 21 % to 23 %, however it doesn’t plan to change the lowered or zero rates of the VAT. The present year Luxembourg has equated the lowered rates of the VAT for electronic books to books of a usual format. Now this reduced tax makes 3 %. Holland and Portugal too have added the list of the reduced rates of the VAT. Sweden has reduced VAT rates for restaurant service and a catering from 25 % to 12 %. In addition to it, Poland is going to increase rates of three kinds of the VAT up to 24 %, 9 % and 6 % since July, 2012. The Czech Republic plans to enter the flat rate of the tax below 17,5 % since January, 2013. Italy is going to increase rates of the VAT to 23 % and 12 % since September, 2012 with the further increase by 0,5 % since January, 2013.

An average Russian spent 3060 rouble for New Year´s table, told the head of Rosstata Alexander Surinov.

“We did calculations based on the minimum cost of sets of food products for a New Year’s table for a family that consists of three adults and one child”, — Surinov has explained. In 2010 an average Russian spent 2897 roubles for the New Year’s table. In 2011 Muscovites spent on the average 3787 roubles for meal and drinks for New year´s Eve. The inhabitants of Republic of Kalmykia were the ones who spent less than others for the New Year´s Eve. Their average cost of a celebratory food made 2540 roubles.

Concerning the matter of inflation, Surinov has noticed that in the end of the past year inflation in Russia made 6 % which is on 2,8 % less, than in 2010 and 2009.

“Inflation of 2011 is the lowest in 20 years”, head of Rosstat has told.

The first day of year 2012, new taxation rules entered in force for representatives of Ukrainian small and average business as since the first of January some changes to tax laws have become valid.

The most important changes have concerned some taxes operating in Ukraine. The profit tax became less. Now for the representatives of both average and large business the tax rate will be of 21 %. We will remind that last year the given tax made 23 %, and two years ago it was 25 %.

Changes have concerned also so-called “reductionists”, whose annual income doesn’t exceed 150 thousand grivnas. Such category of businessmen will monthly pay now the tax at the rate up to 10 % from the sum of the minimum salary. For businessmen whose annual income doesn’t exceed 1 million grivnas, and the quantity of the employed workers doesn’t exceed ten persons, the tax will establish at the rate from 2 to 20 %. But now it becomes mandatory to pay separately the pension tax.

Also since the first of January the list of single tax payers from which jewelers, antiquaries and representatives of gambling sphere were excluded, has changed. Besides, now businessmen who are engaged in realization the goods (cigarettes, alcohol), and also those who is engaged in exchange can’t work on a basis on single taxation.

Ten years ago the inhabitants of 12 countries of the European Union had for the first time a possibility to have in hands cash euros. However, those were only coins.

In Germany in any bank one could get the coins soldered in a polyethylene bag. For 20 DM gave a set of coins in the total cost 10 euros 23 cents. The exchange was carried out at an official rate, without collection of commission fee. Already on the 1st of January, 2002 in dozen of EU countries euro has officially entered in circulation for cash payments. Then term “eurozone” became popular.

The European central bank with headquarters in Frankfurt am Main was founded in 1998, three and a half a year before introduction of euro in the cash operations. In many aspects the German federal bank was an example for it. Maintenance of price stability in eurozone became the first challenge for the main European financial institution. Taking in account the rate of inflation over the last ten years, and also the euro exchange rate to other leading world currencies, the history of the new currency is a history of success.

The European Central Bank managed to keep stability of euro. On January, the 4th, 1999, when the new currency began to be used in clearing settlements along with national currencies of the EU countries, one euro has been estimated in 1,18 US dollars. However subsequently, as soon as the monetary unit course began to decrease, politicians and economists became nervous. The euro exchange rate to the American dollar reached the lowest level in October, 2000. Thattime one euro cost only 82 American cents. For comparison: now the euro costs about 1,3 US dollars.

And though some countries of eurozone have serious budgetary problems, euro as means of payment has justified itself. Businessmen have saved billions on a difference of exchange rates. Thanks to new monetary unit Germany could strengthen the positions of one of leading export powers of the world. After the American dollar the euro became the second important reserve currency in the world.

However the South European countries didn’t use the possibilities that opened before them. Instead of investing in the branches that could provide economic growth, they began to increase budgetary expenses on social sphere. In Greece for last 15 years these expenses have grown from 19 to 25 percent from total amount. Portugal demonstrated approximately the same numbers.

That is why the countries that were so proud of their economic growth are passing now through the structural crisis. One of their main problems is the high prices and the big salaries. They could become more competitive as a result of devaluation of the currency. However the states of eurozone are deprived of such possibility. And that is one of the weak points in the switching to euro.

Euro zone crisis is not over, German experts are warning. In their opinion, in coming year the future of sole European currency will be in danger. They consider that it will depend on Italy whether it will be possible to avoid euro area disintegration.

Euro zone crisis is far away from being over. New escalation is quite probable, the director of the Hamburg Institute for World Economy (HWWI) Thomas Straubhaar assures. The matter is complicated because on the one hand there is need to consolidate budgets but on the other hand, “not to strangle a conjuncture”, the professor considers.

In his turn the Deutsche Bank chief expert in macroeconomic Thomas Mayer is convinced that coming year becomes decisive for the future of euro. “It is a matter of survival of the European currency”, — he has declared. Thus the expert is sure that the monetary unit future depends on Italy. As he said, in the beginning of 2012 Italy will run into deep recession. “Italy will become an example for all southern European countries if it manages to overcome the recession by elections in May, 2013 and I expect it to happen. If it doesn´t happen, the eurozone will split up”, — Mayer has declared.

The committee of Latvian Cabinet of Ministers has approved the bill prepared by the Ministry of Finance concerning the procedure of depositing savings in cash to bank accounts. As it is specified, till the 1st of June, 2012 the Latvians, which have saving in cash exceeding 10 thousand lats (14 thousand euro), it becomes obligatory to introduce a part of savings to the bank account.

It is obligatory to introduce to the bank account only a part of savings which exceeds 10 thousand lats.

It is supposed that the terms indicated in the draft of the law on nil return and in the draft of rules will call difficulties. It is explained that the Latvians had to declare their financial situation that they had by midnight on the 31st of December, 2011 and it should be indicated in nil return. The draft of rules says that the cash should be deposited to a bank account by midnight on the 1st of June 2012 and the funds should be on the account by 00:05 the 2nd of June. It may be interpreted the following way: to make a financial statement, the inhabitants will have to “freeze” a part of their savings on bank accounts because from the 1st till the 2nd of June, 2012 the sums declared in financial statements by the 31st of December must be on the bank account. It is not quite clear why this date s chosen to be a starting point.

The draft of rules states that there will be no need to “freeze” the funds on bank accounts. The inhabitants will not be able to dispose their funds on bank account only from 00:00 till 00:05 on the 2nd of June. This point will require additional clarifications. As it no clear if one can deposit the sum to the bank and later withdraw it any day before the 1st of June. The rules also don´t oblige the banks to introduce any special tariffs for depositing and further withdrawing of funds from the bank account. If a person doesn´t follow the regulation on nil return and doesn´t deposit the exceeding sum to a bank account in the established dates, upon a request of Service of State Revenue of Latvia, the person will have to explain the reasons why he didn´t fulfill the regulations.

About 55 thousand companies from total number registered in Cyprus, by the beginning of 2012 have paid the new tax of 350 euro which was introduced in August last year by Parliament of Cyprus within the framework of a package of the economic measures on tax consolidation. Under the statement of head of the Companies Register of Cyprus Spirosa Kokkinosa, at the beginning of year the total sum of paid tax has exceeded 19 million euro.

In Belarus the inflation in 2011 beat a record made almost 109 %, the numbers provided by National Committee for Statistics of the Republic. The consumer price index on the goods and services in December, 2011 in comparison with December, 2010 made 208,7 %, thus a price index of manufacturers of an industrial output made 249,4 %, and a price index of food products made 225 %.

The price of fish canned food, fruit, vegetables, sugar, tea, fowl, confectionery, oil animal and vegetative, cheeses, eggs, groats, alcoholic drinks, tobacco have risen approximately 2 times. The prices of automobile fuel, perfumery — cosmetic products, synthetic washing-up liquids, building materials, bicycles and motorcycles, fabrics have also considerably risen.

As to the sphere of services prices for preschool institutions, tourist permits, tickets for planes, and also for trains and buses of the international message has risen more than others.

Complexities in economy of Belarus began spring last year then the country government repeatedly raised retail prices for bread, milk, meat, cigarettes and other products.

The state debt of the USA exceeded annual gross national product of the country. The debts sum makes 15,23 trillion dollars, and total amount of the goods and the services made during the year by the American economy is estimated in 15,17 trillion dollars. At least not to lag behind debts growth, it is necessary for the US economy to grow at least six percent a year. Experts notice that now among the developed countries only in Greece, Ireland, Iceland, Italy, Portugal and Japan the size of a state debt exceeds annual volume of gross national product. The European countries from this list are in epicenter of the so-called “sovereign debt crisis”. Almost all of them have been compelled to ask for help, and Italy has got under financial supervision of IMF. The researches underline that the USA hasn´t had such a high level of debts since the Second World War. However, some American economists suggest not considering internal promissory notes of Treasury under social security programs. But it isn’t so logical, as these debts for the American politicians are the most inviolable. And without them the state debt of the USA is very bug: about 10,5 trillion dollars, that is 70 percent of gross national product.

Despite the economic crisis which hit Europe the quantity of the international companies registered in Cyprus at the beginning of 2012 has increased. Now there are more than 250 thousand. It first of all Cyprus is attractive for creation of the Cyprian international companies which have the lowest tax on income (10 %) and the low VAT (17 % since March, 1st, 2012) . Besides, the government of Cyprus has introduced new more favorable conditions for businessmen for obtaining Cyprian citizenship. According to new rules, the Cyprian citizenship can be given a foreigner at the age of at least 30 years, who has no previous conviction, possesses real estate in Cyprus in cost not less than 500 thousand euro and corresponding to one of following criteria: 1) Applicant for citizenship of Cyprus should make a direct investment in theRepublic Cyprus at a rate of at least 10 million Euro. That may be real estate, sheres and promissory notes. 2Applicant may manage the Cyprian company which should have an annual turnover not less than 10 million Euro throughout last three years provided that not less than one third of its employees are Cypriotes. 3) Applicant can introduce to the island new innovative technologies and research centers. It must be proved that these technologies are essential for the Cyprian economy. 4) Applicant for the Cyprian citizenship should have personal contributions to the Cyprian banks, or contributions to the Cyprian companies or the trusts managed by him in the territory of Republic Cyprus in size not less of 15 million of euro. These contributions should remain in the Cyprian bank for minimum 5 years. 5) Cyprian citizenship can be given when the applicant has the combined direct investments and deposits in the Cyprian banks. 6) The direct incomes received for services can become a reason for granting Cyprian citizenship to the applicant. For this purpose it is necessary to have the company in Cyprus which pays all taxes, including the VAT, pays services of lawyers, accounting services, services of banks etc. for 500 thousand Euro a year. New criteria of reception of the Cyprian citizenship have essentially changed and have improved naturalization possibilities in Cyprus in comparison with former, accepted in 2008. For businessmen from other countries the Cyprian citizenship is a way to get a citizenship of the European Union.

“The decision on change of ratings is mainly related to the fact that the measures taken last weeks by the European politicians can be insufficient resolving problems in eurozone”, — has declared in January the American agency Standard&Poor’s. These problems, according to analysts of the Agency, include deterioration of credit conditions, growth of profitability under promissory notes, deterioration of prospects of economic growth, and also proceeding dispute between the European politicians on the approaches to the decision of these problems. Analysts of Standard& Poor’s also consider that a number of the countries of eurozone in the near future can face growth of cost of attraction of foreign investments. Meanwhile the Eurocommission named “erroneous” the decision on decrease in ratings of nine of 17 countries of a zone of euro, including France, Austria, Italy, Spain and Portugal. Germany with its highest rating ААА hasn’t suffered. Greece hasn’t suffered also — it rating СС has been left without changes. Loss of the higher credit rating by France and Austria can complicate financing of the European Fund for Financial Stability (EFSF) which the euro area countries have created for struggle against crisis of a sovereign debt in Europe." Being convinced that the moment for taking this decision is chosen not by chance, I express a regret in connection with the erroneous decision Standard& Poor’s, concerning ratings of some the countries of a zone of euro when the euro area adopts all the possible measures to overcome the crisis “, - the eurocommissioner on the economic and financial policy Olli Ren has declared. He has underlined that this situation once again confirms the necessity of budgetary consolidation and structural reforms for the countries of a zone of euro, and also efforts on introduction constantly operating European stabilization mechanism. This mechanism should be started in the summer this year, replacing with itself the current temporary European mechanism of financial stability. In January Europeans repeatedly expressed opinion on necessity of creation of their own European rating agency. Nevertheless “waves” from decision Standard&Poor’s have gone worldwide. So, the week in the financial market of the European Union terminated with strong fall of the exchange rate of euro — 1,08 percent to a US dollar. By now it is difficult to predict all consequences of mass decrease in ratings of the countries of eurozone. However it is clear that it doesn’t help to resolve the present serious crisis of debts and to the prompt overcoming of system financial crisis.

The republic of Cyprus in the name of Minister of Trade, Industry and Tourism dispatched invitations to the companies interested in licenses for extraction of hydrocarbonates in an exclusive economic zone on a continental shelf of Cyprus according to the instruction 94/22/ЕС of the European parliament and Council from 5/30/1994 on working out and manufacturing hydrocarbonates. (Article 3 (2))

The American company Nobel Energy Inc became the first who obtained the license for gas working out in the block 12 exclusive economic zones of Cyprus. According to experts of Energy Department of the Cyprian Ministry of Trade, Industry and Tourism, the stocks of gas found out in Cyprus can provide within the next 60 years all countries of Europe, or satisfy the needs of Cyprus for gas for 200 years.

London has taken an important step on a way of transformation to the large financial center on trade in yuan and the financial tools nominated in it. Such transformation will help the British capital to become less dependent on euro zone, having increased volume of transactions passing through local banks and having created in the City thousands of new workplaces.

The special agreement on this subject waas signed in January in Hong Kong by the Minister of Finance of Great Britain George Osbornom and Head of Financial Regulator of Hong Kong Normanom the Tub. The parties agreed on creation of the special British-Chinese forum, called to find the best ways of creation of clearing systems, workings out of the financial tools nominated in yuans and saturation of this market by liquidity. It is expected that “the round table” will call twice a year the most important representatives of financial sector. Passed in frameworks of working visit of Osborna to China the meeting became logical continuation of arrangements between Beijing and London reached in September. Then the parties confirmed the interest in joint cooperation.

It is remarkable that the parties already had time to undertake quite concrete steps on an establishment of business ties. So, financial regulators of Hong Kong made decision to prolong an operating time of the payment system for transactions in yuans to June, 2012. It will allow London to avoid delays at realization of calculations and carrying out other financial transactions in the Chinese currency.

For China the choice of London not for example New York, as special financial partner isn’t by chance. Positions of the British banks in Asia are traditionally strong. For example, in 2010 the British bank Standard Chartered organized the issuance of bonds of the foreign company first in the history nominated in the Chinese currency. That time the corporation McDonalds managed to borrow about 30 million dollars for 3 % of annual interest rate.

Orientation of London to the East can essentially strengthen city positions in the list of the largest financial centers of a planet. It is especially important in view of future financial isolation of Great Britain within the limits of EU, caused refusal of local authorities to impose the tax to financial transactions. “Business relations with Hong Kong will allow London to expand horizons and at least partly to get rid of dependence from euro zone. It is possible to name it an original diversification. However, it is not absolutely clear yet, how much time will be needed for a similar transformation. Much depends on the Chinese party who apparently has a very positive relation towards this project and it is ready to support London in this undertaking in all possible ways”, — the senior economist on Velikokbritanii Societe Generale Bryan Hillard explained. Orientation to yuan will considerably increase volumes of transactions of the companies from City. According to an estimation of National bank of China, the international trade turnover with calculations in yuans makes nearby 330 trillion dollars annually. Still nearby 17,5 trillion dollars are necessary on the direct foreign investments also nominated in the Chinese currency. By estimations of experts, by 2020 the international trade turnover in yuans will reach 1 trillion dollars.

Next decade stock exchanges of developing countries should overtake already generated financial centers. There will be place also for the Russian platform of the Moscow Interbank Stock Exchange-RTS which as regards IPO can become more interesting than the foreign companies, than Tokyo and Frankfurt.

In January research of PricewaterhouseCoopers (PwC) “the capital Markets in 2025 was published: the Future of stock markets”. Almost 400 heads of the largest companies from different countries of the world have been interrogated. Three quarters of the interrogated top-managers are assured that large stock exchanges of the developed countries underestimate a competition from developing platforms and will be compelled to put more efforts for attraction of interest of emitters. The majority of the interrogated considers that such financial centers as London and New York, will start to lose the weight, and the stock exchanges located in them — market shares.

Almost three quarters (74 %) of the interrogated consider that the companies with emerging markets will plan listing at a stock exchange of one of emerging market economies. The stock exchange of Shanghai which can overtake American NYSE should become the leader by 2025. At the same time stock exchanges of other countries of group BRIC, such as India and Brazil, become more attractive to emitters, than LSE or NASDAQ.

The Russian Moscow Interbank Stock Exchange-RTS doesn’t remain aside, it will be more interesting to listing than Deutsche Borse and the Tokyo stock exchange. Now only 1 % of respondents consider the Moscow Interbank Stock Exchange-RTS as a platform for placing of the securities, but by 2025 the quantity of such interested persons will increase to 11 %. It is expected that by this time will prevail IPO the Chinese and Indian companies which become champions on capital attraction.

The chairman of board of directors of MDM-bank Oleg Vjugin considers that poll of foreign top-managers shows their mood for next 15 years: the Asian markets and Russian being close to them, will develop faster than the European debts European and American economy. “It is necessary to give the chance to develop in Russia normally to investment funds, saving institutions, and also to carry out privatization of the Russian companies at a domestic stock exchange”, — Mr. Vjugin makes comments.

According to the president of Moscow Interbank Stock Exchange-RTS Rubena Aganbegjana, one of the purposes of association of stock exchanges just also there was an increase of appeal for IPO and the secondary reference of securities in Russia. “For achievement of it we should raise quality of service, to simplify access of investors on a stock exchange, including to make it more habitually for foreigners. For this purpose we create a uniform trading platform for all actives with powerful post trading infrastructure. It is impossible to forget and about development of a class of the internal investor so necessary for the Russian market”, — Mr. Aganbegjan says.

Other stockbrokers consider that in Russia there is a number of positive factors which in long-term prospect will allow to increase quantity of placings: the growing demand is formed from internal investors, there are the new emitters which volumes of issues gradually increase. “These factors in case of successful development of an infrastructure will promote increase in quantities IPO and SPO”, — they consider.

Russia can show considerable growth, but it loses in comparison the competitors on BRIC. Decrease in growth of the developed countries is related to the fact that the local markets will develop faster than they, — a vivid example to that is Warsaw that on volume of IPO has already overtaken London, analysts say.