What kind of "authority" can such a currency have?
This year the Belarusian ruble celebrates its 25th anniversary. During this time, our national currency has set many records. For example, during this time, the Belarusian ruble has dropped against the dollar by 1444200 times. Belarus managed to break the world record on devaluation in 2011 and to hold denomination in 2016.
Charter97.org talked to a well-known economist Leanid Zaika, who summed up the results of 25 years of the Belarusian ruble existence, spoke about its prospects and even shared his piece of advice on the best currency to keep his savings in.
- Leanid Fiodaravich, tell us about these 25 years of the Belarusian ruble.
- Small countries play a game called "sovereign currency". The smaller a country is, the more it becomes proud when it creates its own national currency.
In the 1990s, we were the last to introduce our own currency, together with Tajikistan. The experience of the Austro-Hungarian Empire shows that those countries that introduce their own currency more quickly win. We clung to the USSR for a long time and lagged behind a bit.
The Belarusian ruble has become a very weak, illustrative currency, which was called "wooden" by the people. Our currency is still called "bunnies". The process of devaluation of the Belarusian ruble took much time. Inflation reached 1000% per annum and reached up to one million.
I kept writing and saying that a normal monetary unit and switch to a gold standard had to be introduced. Only after 12 years of articles and strong recommendations the authorities dared to denomination. If the authorities had heard and carried out it earlier, it would have been possible to achieve a ratio of 1 euro against 1 ruble. Now the ratio is 1:2.
We have been competing hard with Zimbabwe for a long time. By the way, we are lagging behind a bit: they overthrew their president, but we did not.
The major thing that the authorities ignored during the denomination was the introduction of the gold standard. The Belarusian ruble should be provided with gold. The introduction of the gold standard would make us a leading country in the world. China will come to this, the whole world will also switch to it. The first to do this will take the floor.
The creation of a single currency with Russia has been discussed for a long time. I'd like to say to its adherents that the Russian ruble does not fulfill its function; it has no real value. Russians need to cross out two zeros. I discussed it with Andrei Illarionov, Putin's former advisor, and he fully supports it. He also advocates the deletion of two zeros.
I would strongly recommend our government to get rid of the nominalistic theory and switch to the gold standard. But Belarusian officials and the government are not ready for this; they are uneducated and unskilled.
- A photo has appeared on the Web, which clearly demonstrates the "success" of the Belarusian ruble over the years. The bill of 1 million rubles and ten kopecks and its real current value. How would you comment on it?
- The country's leaders thought money could be copied like post stamps. It's just ordinary incompetence, stupidity to the second and the third power. I can call it the case of unprofessional stupidity.
- Don't you think that the denomination has become a certain psychological trick covering price hikes?
- I'm neither a shaman nor a psychotherapist, not even a psychedelic illusionist, just an economist. From the point of view of science, nothing changes. The process of semicolon movement and manipulation with zeros can affect both sides. The main thing is that the denomination was carried out. In due time, we carried out a study and it was said that countries with so many zeros had no future. The denomination was carried out, although 12 years later. By the way, the next country to face denomination is Russia. When they delete two zeros, you will remember my words.
– What is the image of our national currency on an international arena?
- The Belarusian ruble is not a convertible currency. What authority can a country with a GDP share of 0.2% of the world's one have? Nobody even has to know the Belarusian ruble. It's like Aunt Frosia from a farm near Dikanka. Who should know about her? Of course, when there were "bunnies", "wolves" and other animals, everyone was just a mess. Then I worked abroad and remember that my young colleague converted one Belarusian "bunny" into one American dollar. That was the best transaction in the history of our currency.
Today the Belarusian ruble, by definition, cannot be of interest. No illusions are allowed. And if we had introduced a gold standard, everyone would have followed us and said, "Belarusians, we want to join you!
Again, I used to work in China and studied the issue. China will come to the golden yuan, the Russians will also do it later, and we could have done it yesterday. But we need professionals running the country.
- What currency is more reliable for savings? Share the secret, what currency do you prefer?
- I've been saying for ten years now that if you have less than $100.000, you'd better buy champagne, have a nice candlelit dinner and don't worry.
And if seriously, save 40 percent in dollars, 20 percent in euros, 20 percent in Chinese yuan, and the rest of the money can be Swiss francs. The more differentiated your basket is, the better.