The reason behind a political crisis is Britain’s domestic policy. We agree with RF Foreign Affairs Minister Sergey Lavrov who said the following at a press conference after the Middle East Quarter meeting, “I can see the “new government” factor in what’s going on here (escalation of tensions between Russia and Britain).”

We would like to add that such a turn for the worse in relations with Russia could be due to intention to hush up the issue of gold sale from the Bank of England in 1999 which the British media began to raise. Gordon Brown was Finance Minister at that time and he approved the sale of 300 tons of gold from the reserves of the Bank of England. The metal was sold at around $275 per troy oz of gold, which was close to a 20-year low of $250. For the record, the price of gold is currently around $675 per troy oz and the loss from this operation amounts to roughly $3.8 bln.

As a matter of fact, Great Britain’s position is none too logical. The UK is demanding that Andrey Lugovoy be extradited, which is at odds both with European law and the RF Constitution. In addition, Great Britain refuses to submit to the RF Prosecutor General’s Office any materials as part of the “Alexander Litvinenko” case. Meanwhile, Great Britain has totally ignored requests by Russian law enforcement agencies to extradite Boris Berezovsky, who publicly announced from London his intentions to violently overthrow the state system in Russia.

We do not expect this crisis to have any negative economic repercussions.

Jochen Biedermann, Head of Business Development Department of Deutsche Boerse for Russia and CIS agrees with this opinion. “Frankly speaking, I am far from politics. From the standpoint of Deutsche Boerse, Frankfurt Stock Exchange, this situation will not likely produce any tangible impact on the stock market. Such problems are to be discussed by politicians rather than businessmen.”

An Englishman who has been living and working in Russia for a long period of time and preferred not to disclose his name voiced a more cautious opinion, “A lot of people are involved in business and trade between Russia and Great Britain, including oligarchs and businessmen. If London takes more measures, God knows how the situation will unfold. For the time being, at this stage, I believe that Great Britain is not interested in broadening the range of complex issues for both parties and there will be no threat to business.

Russia is known to be quite a powerful state and feuding with such country could trigger unfavorable economic repercussions. For this reason, I believe that politics mainly comes into play here.

At present, many Russian companies are picking London as the place to have their shares listed and disagreements between the countries will not likely seriously impact the choice of trading venue.”

Foreign investors which have interests in Russia are well seasoned individuals and are remiss to react to media hype. We will therefore likely see little or no capital outflow from Russia.

Moreover, Britain stands to lose more than Russia if push comes to shove and the escalation spills over into economics. If the situation unfolds under the worst-case scenario, according to the President of the Russian Union of Industrialists and Entrepreneurs Alexander Shokhin, many Russian companies will delist from LSE. We would like to add that many prosperous Russian people would have to abandon their real estate acquisitions in London due to visa problems. However, British businessmen could face infinitely greater hurdles in Russia, given their multibillion-dollar projects.

We therefore believe that the current ratcheting up of tensions between Russia and Great Britain will ease in the coming weeks and we agree with Russian President Vladimir Putin, “I believe that Russian-British relations will develop normally. I am confident that we will cope with this mini-crisis too”.