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Record number of rich Russians head to UK
From the Financial Times of Sun, 21 Dec 2014 17:16:39 GMT
LONDON, ENGLAND - MAY 28: Passengers arriving at Gatwick Airport use the 'ePassport gates' at Passport Control on the UK Border on May 28, 2014 in London, England. Border Force is the law enforcement command within the Home Office responsible for the security of the UK border by enforcing immigration and customs controls on people and goods entering the UK. Border Force officers work at 140 sea and airports across the UK and overseas. (Photo by Oli Scarff/Getty Images)©Getty

Rich Russians are gaining entry to the UK in record numbers amid a worsening economic outlook in their home country.

The number of Russians who were granted investor visas this year has soared by 69 per cent, according to Home Office statistics. The visas gave foreigners from outside the EU a fast track to residence and citizenship in return for buying gilts worth £1m to £10m.

In the first nine months of the year, 162 investor visas were granted to Russians, compared with 96 in the same period of 2013, the figures show. The whole of 2013 saw only 118 investor visas granted to Russians, according to the data, which were first reported by The Sunday Times.

Falling oil prices, western sanctions against Moscow over its actions in eastern Ukraine, and a plummeting rouble have all taken a heavy toll on the Russian economy — sending capital flight to new heights and draining state coffers.

The rouble plunged 11 per cent last week, despite a big interest-rate rise by the central bank.

The most powerful and rich among Russian society have had a nervous time of late: the September arrest of Vladimir Yevtushenkov, one of Russia’s richest men — and a subsequent court ruling forcing his Sistema Group to hand its Bashneft oil company back to the state — triggered warnings both from tycoons and reform-minded government officials that the country’s investment climate was being undermined.

Mr Yevtushenkov was released from house arrest last week and attended a banquet hosted by President Vladimir Putin a day later with other oligarchs. His invitation sent shares in Sistema soaring by more than 300 per cent in intraday trading.

Investor visas have proved particularly popular with Russians and Chinese, but the British government is — for the first time in two decades — making them harder to obtain. New rules that came into force last month raised the minimum amount needed to £2m from £1m, and brought in restrictions on the nature of the investment.

Until the recent change, visa applicants had been permitted to spend a quarter of their total UK investment on property, but this is no longer allowed. Although the Home Office did not given a reason for its decision, it was widely considered to be a response to public anxiety about foreigners investing in London properties that remain vacant.

The Home Office’s independent immigration advisers calculated in February that the scheme resulted in about £500m of gilts investment a year, and said this would “barely fund two days’ worth of the national deficit”.



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