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USSR TO RISE FROM ASHES THROUGH JOINT EURASIAN CURRENCY
PRAVDA
Nov 19 2012
Russia
Maria Snytkova
Pravda.Ru. 19.11.2012
The creation of the supranational currency within the scope of
the Customs Union is inevitable, Prime Minister of Armenia, Tigran
Sargsyan, believes. According to him, this should be the next stage of
integration within the organization, which makes sense from the point
of view of simplification of currency circulation in transfers. The
new currency may see the light on January 1, 2015.
As the prime minister of Armenia said during the meeting with members
of the Club of Editors of the CIS, Baltic countries and Georgia, it
would be advantageous for three member states of the Customs Union to
have a supranational currency. "This is beneficial both to economic
entities and citizens. What's the point in having a national currency
and losing money during transfers?" said Sargsyan.
The Armenian Prime Minister also said that Russia, Belarus and
Kazakhstan are now at about the same level of development, "and no
country is going to live at the expense of another." According to
Sargsyan, five years of coordinated monetary and fiscal policy will
be enough for everyone to realize the need for a single currency.
However, for representatives of the Russian side this question is
important already today. The active discussion of the issue began in
the summer of 2012.
"In the summer of this year, Russian Prime Minister Medvedev called
for the creation of a single currency for Russia, Belarus and
Kazakhstan. He repeated a similar idea at the recent CIS forum in
Yalta - Alexander Razuvayev, Ph.D. and Director Analytical Department
of Alpari said in an interview with Pravda.Ru. - In principle, it may
seem that the idea looks a little strange against the background of
the crisis in the euro zone and the probability that not only Greece,
but perhaps Spain may leave the euro zone, but there is a grain of
common sense here, because money decides a lot in today's world. Only
a single currency may actually unite the single economic space."
Originally, the main challenge to the single currency of the Customs
Union was the fact that the idea was presented by the Russian
government from the dominant position. That is, Russia offered the
CIS countries to join the ruble zone, while Moscow would retain the
right to control the money-printing process, and other countries
would automatically fall into dependence on the Russian Central Bank
and the Finance Ministry. Needless to say that this approach left
Belarus and Kazakhstan dissatisfied. As a result, everyone started
to pull the blanket over in this matter.
"Some would say that Belarus has planned economy, some would say
that there are problems in Kazakhstan. However, we must realize that
Russia's economy is much larger than that of Kazakhstan, and especially
of Belarus. One shouldn't forget that Russia has world's third largest
international reserves, more than 500 billion dollars, and Russia's
GDP this year is about 2 trillion. Accordingly, given the positive
macroeconomic situation in Russia, this includes the growth of more
than 4 percent, and the budget surplus, so to form a currency area
like that would be easy enough, taking into consideration the fact
that there is political will for that on the part of Russia, Belarus
and Kazakhstan. As for Belarus, the idea was very popular 10 years
ago, but during that time Mr. Lukashenko wanted to have the emission
center. Well, of course, neither the Russian Finance Ministry nor
the Russian Central Bank could accept that," says Alexander Razuvayev.
Another major problem of the Customs Union was Ukraine's reluctance
to join it. Experts say that the full integration within the Customs
Union and the Eurasian Economic Community is impossible without
the participation of Ukraine. However, it was reported at the end
of last week that Ukraine's Ministry of Foreign Affairs reiterated
the impossibility of joining the Customs Union, as the country sets
the course for European integration. The reasonable arguments saying
that the Russian market was much more advantageous for Ukraine than
the Ukrainian was for Russia, have not brought any results.
Surprisingly, though, the free trade idea between the CIS countries
and Russia inspired the Crimean Republic, the first president of
which, Yuri Meshkov, unexpectedly expressed his intention to join
the Customs Union regardless of the Ukraine. Moscow does not hope
much for the influence of the Crimea, although it may ring another
"bell" for Ukraine's Yanukovych. Experts tend to see the "hand of the
Kremlin" here, rather than an independent decision made by the head
of the autonomous territory. However, it is no secret that Russia
can make Ukraine join the union through the use of more abrupt,
manipulative measures.
"In today's world, only 200-250-million-strong markets can be
self-sufficient. Kazakhstan and Russia, plus Belarus is somewhat less.
And, accordingly, the system can work only if Ukraine is integrated.
One shouldn't forget that Russia can put pressure on Ukraine through
energy carriers," says Alexander Razuvayev.
To date, Russia has taken a detached attitude to Ukraine. Ukrainian
officials say that there could be a possibility for the country to
join the Customs Union in the event the economic situation in the euro
zone worsens. For the time being, Ukraine is standing at a crossroads,
wondering which union to join.
"Either way, it is believed that the new currency will appear on
1 January 2015, although possibly earlier. Political sovereignty
can hardly be questioned. It is unlikely that it will be the
Russian ruble. Most likely, it will be a new Eurasian currency, and,
consequently, we will have a new Eurasian Central Bank. Of course, it
will be a local currency, because the size of combined economies is
still a lot smaller than the economy of the United States, China,
or the European Union. However, it will really mark the actual
denunciation of Belovezha Accords and restoration of the Soviet Union,
albeit in a new version 2.0 and on absolutely new market and capitalist
principles," the expert concluded.
http://english.pravda.ru/business/finance/19-11-2012/122851-joint_eurasian_currency-0/
PRAVDA
Nov 19 2012
Russia
Maria Snytkova
Pravda.Ru. 19.11.2012
The creation of the supranational currency within the scope of
the Customs Union is inevitable, Prime Minister of Armenia, Tigran
Sargsyan, believes. According to him, this should be the next stage of
integration within the organization, which makes sense from the point
of view of simplification of currency circulation in transfers. The
new currency may see the light on January 1, 2015.
As the prime minister of Armenia said during the meeting with members
of the Club of Editors of the CIS, Baltic countries and Georgia, it
would be advantageous for three member states of the Customs Union to
have a supranational currency. "This is beneficial both to economic
entities and citizens. What's the point in having a national currency
and losing money during transfers?" said Sargsyan.
The Armenian Prime Minister also said that Russia, Belarus and
Kazakhstan are now at about the same level of development, "and no
country is going to live at the expense of another." According to
Sargsyan, five years of coordinated monetary and fiscal policy will
be enough for everyone to realize the need for a single currency.
However, for representatives of the Russian side this question is
important already today. The active discussion of the issue began in
the summer of 2012.
"In the summer of this year, Russian Prime Minister Medvedev called
for the creation of a single currency for Russia, Belarus and
Kazakhstan. He repeated a similar idea at the recent CIS forum in
Yalta - Alexander Razuvayev, Ph.D. and Director Analytical Department
of Alpari said in an interview with Pravda.Ru. - In principle, it may
seem that the idea looks a little strange against the background of
the crisis in the euro zone and the probability that not only Greece,
but perhaps Spain may leave the euro zone, but there is a grain of
common sense here, because money decides a lot in today's world. Only
a single currency may actually unite the single economic space."
Originally, the main challenge to the single currency of the Customs
Union was the fact that the idea was presented by the Russian
government from the dominant position. That is, Russia offered the
CIS countries to join the ruble zone, while Moscow would retain the
right to control the money-printing process, and other countries
would automatically fall into dependence on the Russian Central Bank
and the Finance Ministry. Needless to say that this approach left
Belarus and Kazakhstan dissatisfied. As a result, everyone started
to pull the blanket over in this matter.
"Some would say that Belarus has planned economy, some would say
that there are problems in Kazakhstan. However, we must realize that
Russia's economy is much larger than that of Kazakhstan, and especially
of Belarus. One shouldn't forget that Russia has world's third largest
international reserves, more than 500 billion dollars, and Russia's
GDP this year is about 2 trillion. Accordingly, given the positive
macroeconomic situation in Russia, this includes the growth of more
than 4 percent, and the budget surplus, so to form a currency area
like that would be easy enough, taking into consideration the fact
that there is political will for that on the part of Russia, Belarus
and Kazakhstan. As for Belarus, the idea was very popular 10 years
ago, but during that time Mr. Lukashenko wanted to have the emission
center. Well, of course, neither the Russian Finance Ministry nor
the Russian Central Bank could accept that," says Alexander Razuvayev.
Another major problem of the Customs Union was Ukraine's reluctance
to join it. Experts say that the full integration within the Customs
Union and the Eurasian Economic Community is impossible without
the participation of Ukraine. However, it was reported at the end
of last week that Ukraine's Ministry of Foreign Affairs reiterated
the impossibility of joining the Customs Union, as the country sets
the course for European integration. The reasonable arguments saying
that the Russian market was much more advantageous for Ukraine than
the Ukrainian was for Russia, have not brought any results.
Surprisingly, though, the free trade idea between the CIS countries
and Russia inspired the Crimean Republic, the first president of
which, Yuri Meshkov, unexpectedly expressed his intention to join
the Customs Union regardless of the Ukraine. Moscow does not hope
much for the influence of the Crimea, although it may ring another
"bell" for Ukraine's Yanukovych. Experts tend to see the "hand of the
Kremlin" here, rather than an independent decision made by the head
of the autonomous territory. However, it is no secret that Russia
can make Ukraine join the union through the use of more abrupt,
manipulative measures.
"In today's world, only 200-250-million-strong markets can be
self-sufficient. Kazakhstan and Russia, plus Belarus is somewhat less.
And, accordingly, the system can work only if Ukraine is integrated.
One shouldn't forget that Russia can put pressure on Ukraine through
energy carriers," says Alexander Razuvayev.
To date, Russia has taken a detached attitude to Ukraine. Ukrainian
officials say that there could be a possibility for the country to
join the Customs Union in the event the economic situation in the euro
zone worsens. For the time being, Ukraine is standing at a crossroads,
wondering which union to join.
"Either way, it is believed that the new currency will appear on
1 January 2015, although possibly earlier. Political sovereignty
can hardly be questioned. It is unlikely that it will be the
Russian ruble. Most likely, it will be a new Eurasian currency, and,
consequently, we will have a new Eurasian Central Bank. Of course, it
will be a local currency, because the size of combined economies is
still a lot smaller than the economy of the United States, China,
or the European Union. However, it will really mark the actual
denunciation of Belovezha Accords and restoration of the Soviet Union,
albeit in a new version 2.0 and on absolutely new market and capitalist
principles," the expert concluded.
http://english.pravda.ru/business/finance/19-11-2012/122851-joint_eurasian_currency-0/