The impact of financial instruments of the foreign exchange market on capital migration in Kazakhstan

Abstract

The capital migration is one of the important economic processes in a state. There many reasons for the capital exports and imports: the investment climate in a country, the changing rate of profit, labor, raw materials, environmental standards, etc. In the circumstances of global financial crises, which unveil the dependence of countries, the analysis of capital flows is an essential issue. The result of this analysis is the development of anti-migration measures. This article deals with the influence of financial instruments of the foreign exchange market on the migration of capital in the Republic of Kazakhstan. To date, the majority of transactions are conducted on the foreign exchange market of Kazakhstan, which gives reason to make assumptions about the impact of the foreign exchange market on the capital flows in Kazakhstan. The article provides statistical data for the period from 2007 to 2013, a regression analysis, conclusions, and recommendations. The resulting coefficient of determination at 96% confirms the impact of money market instruments on the capital migration in Kazakhstan. Based on the calculated model, we can conclude on the strong interrelation between capital flows and indicators such as the volume of transactions by resident banks, net operations by exchange offices (Foreign exchange cash), imports/exports of the foreign exchange cash by second-tier banks, the trading volume on the Kazakhstan Stock Exchange.