Altyn to become Customs Union's currency?

The common currency of the Customs Union can be introduced in the near future.

Russian company Alpari held the first press conference for Kazakh journalists in Kazakhstan's southern capital. A question of the common currency of the Customs Union was raised at the press conference. Director of Alpari's analytical department Alexander Razuvayev supposes it is likely to be introduced, Forbes reports.

“There are many rumours on the stock exchange. It is supposed that the Eurasian Central Bank will be opened in St Petersburg and the new currency will be called the altyn. Mr Medvedev said that the [common] currency would be introduced on January 5, 2015,” the speaker said.

The expert is confident that the population of the Customs Union member states will learn about the common currency “when everything will be ready”.

“The introduction of the altyn is a political decision,” the analysts noted. “I think Lukashenka is a problem. It is his tradition to fill in the country's budget deficit by printing more money. That's how he makes economic decisions: 'If I have a big budget deficit, I will print as much money as I need to fill it. Bad lack for the population if it is resulted in devaluation.' The president of Belarus does not trust the Russian establishment. He fears, because without the printing press he won't be able to solve economic problems as he got used to do.”

Razuvayev reminded that Lukashenka agreed in 2003 to transfer to the Russian ruble on January 1, 2005, but he asked to control the money issuing centre. Of course, he didn't receive the printing press.

“If the common currency is introduced, which is likely to happen, it will be backed by the export of raw materials and the international reserves of the Russian Federation (it is more than $500bn),” Alpari's representative said. “Some people say the Eurasian currency has no prospects, because the economy of the Customs Union is not the economy of the United States. It is a disputable point of view. Russia and Kazakhstan – the core of the Union – have rather strong economies. It (the common currency) can easily become the regional reserve currency.”

Razuvayev said it would be convenient for business to have the common currency: businessmen won't lose money on currency exchange and will spend less on bank charges.

“The only thing that we can fear (though it is unlikely to happen) is the re-denomination caused by the introduction of the common currency. Money will be more expensive. Any trade rounds the numbers upward. From the experience of Estonia's transfer to the euro: wages didn't change, but prices began to grow almost immediately,” the expert noted.