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. Last Updated: 07/27/2016

Central Bank to Support Shaky Belarussian Ruble




The Central Bank has agreed to allocate a credit of up to $200 million this summer to support the Belarussian ruble as Russia and Belarus prepare to unite their national currencies, a Central Bank source said Monday.


An interbank currency council attended by representatives of the two countries' national banks has decided to grant the Belarussian National Bank's request for money to help stabilize the country's currency.


The credit will be given without a condition that the Belarus National Bank agree to give the Central Bank exclusive rights for printing the countries' joint currency, a source close to the negotiations said.


The Central Bank's decision came after the dismissal of Andrei Cherpanov, the bank's foreign operations director, who recently warned that it would be a fatal mistake to support the Belarussian currency.


Cherpanov said a loan to the Belarussians would never be paid back. He also said Russia would be raising the Belarussian currency's value against final currency exchanges when monetary union takes place in 2005, should the Russian ruble be chosen as the joint currency.


The Russian ruble is set to become the union's official currency, according to an agreement now before the governments of both countries.


That agreement also postpones any decisions on who will print the union's currency until a constitutional act is adopted.


Plans for monetary union provide for a currency board between the Russian and Belarussian rubles to be established by the third quarter of this year. Once the currency board is established the Belarussian ruble will be devalued by 2 percent per month against the Russian ruble.


Belarus National Bank representatives said they expect the currency board to be in place sometime this fall.