The Russian government is beginning an advertising campaign for the ruble as a means of payment for international contracts.
Photo: Sergey Mikheev
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Govt. Markets Ruble to Replace Dollar
Expectations of inflation and weakening of the euro and dollar have provided the Russian government its chance to begin an advertising campaign for the ruble as a means of payment for international contracts. Russian Prime Minister Vladimir Putin made that proposal to Chinese Premier of the State Council Wen Jiabao yesterday during negotiations. He suggested the increased use of both rubles and yuan for mutual trade. Similar suggestions were made to Belarus and Vietnam this month.
Putin suggested to Belarusian Prime Minister Sergey Sidorsky the expansion of “the use of the Russian rubles in mutual accounts” on October 6. That was only the latest in a series of proposals that began in 2006. Dmitry Medvedev made the same proposal to Vietnamese President Nguyen Minh Triet. Yesterday, the Vietnamese president answered positively, saying that “the initiative of the Russian leadership presents more promising conditions for the business circles of the two countries and will significantly simplify accounting between Russian and Vietnam.”
The concept for Russian foreign economic activity approved by Putin on October 27 foresees the transformation of Russia into an international financial center in that time and the use of the rubles in trade with the countries of the Eurasian Economic Community. The Chinese premier did not respond to Putin’s proposal yesterday, nor have Belarusian authorities. Belarusian President Alexander Lukashenko is seeking a $2-billion loan from Russia for prop up its national reserves. Putin used dollars to estimated trade volumes in his negotiations with the Chinese and all monetary sums in the agreements signed yesterday between Russia and China were in dollars.
Oil is already traded in rubles on the St. Petersburg International Commodities and Raw Materials Exchange. Trade on the exchange totaled 82 million rubles today. There are no foreign traders on it yet. According to the Ministry of Economic Development, international contracts with Belarus, Kazakhstan, Kyrgyzstan, Tajikistan and, to a lesser degree, Armenia, are already frequently made in rubles. The new proposals made require that the ruble be stable. They are an unspoken expression of the Russian government’s intention of not allowing the ruble to devaluate.
www.kommersant.com
All the Article in Russian as of Oct. 29, 2008
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