Bankers Give Recognition To Chechnya

The Russian-Chechen peace accord signed last week can justifiably be called a breakthrough and a unique historical document. But amid all the uproar over the accord, another important agreement went virtually unnoticed.

The agreement on currency circulation and clearing transactions between the Russian Federation and Chechen Republic, which was signed by Central Bank chief Sergei Dubinin and the chairman of the National Bank of Chechnya, Aburashid Zakayev, is no less significant than the accord signed by presidents Boris Yeltsin and Aslan Maskhadov.

Understandably, the question of the republic's political status remains an open one. The immediate recognition of Chechnya as an independent state is politically impossible for Yeltsin. By the same token, Chechnya's status as a subject of the federation, on the same level with the Smolensk oblast or even Tatarstan, is absolutely unacceptable for Maskhadov. How the question of Chechnya's status in 2001 will be solved, as stipulated by the Khasavyurt Accord, is anyone's guess. But if politicians are allowed to be vague on such questions, bankers are not afforded the same luxury.

The agreement gives reason to believe that bankers have already decided for themselves how relations between Moscow and Grozny will develop. First of all, the very fact that an agreement on currency circulation has been reached shows a recognition that the territory of Chechnya differs from the territory of Russia. And although the means of payment in Chechnya will remain in Russian rubles, cash circulation and noncash transactions will be organized by the Chechen government and National Bank of Chechnya. The Central Bank of Russia has given up much of its power in Chechnya. Moreover, the Russian Central Bank will not have its administration in the republic and does not consider the National Bank of Chechnya to be a department of the Bank of Russia.

According to the agreement, the National Bank of Chechnya will conduct the banking policies in the republic and oversee the activities of the local commercial banks. It should be noted there are special banking relationships with other republics within the Russian Federation. Yakutia and Bashkortostan, for example, have their own national banks. But essentially, these are national banks only in name.

The National Bank of Chechnya will have greater rights than the national banks in other republics. It could be said that the Central Bank of Russia practically recognized Chechnya's monetary sovereignty. The only thing that the National Bank of Chechnya did not get is the right to issue money. But Chechens most likely did not propose doing so.

As soon as the Chechens get the idea of issuing their own national currency, however, nothing will distinguish the status of the National Bank of Chechnya from the Central Bank of Russia.

Finally, it was the Central Bank of Russia that initiated and drew up the banking agreement. The National Bank of Chechnya simply adopted, with few emendations, the Moscow version of the agreement. "We are realists," one of the Central Bank leaders told me, "and we simply put in the agreement what has long arisen in practice."

Simply put, the bankers recognized what politicians have not yet decided to acknowledge.

Mikhail Berger is economics editor of Izvestia.