alexpgp | A convertible ruble?

From the TimesOnline:

The state Duma has approved a Bill that would impose fines on government officials who talk in terms of dollars or euros, rather than roubles.

It also passed a Bill banning shops, restaurants and businesses from listing prices in “u.e.” — uslovniye yedinitsy, or conditional units. One u.e. equals one dollar or one euro, depending on which gives the business owner the most generous rate on any given day.

Both have been common practice in Russia since hyper-inflation wiped out the rouble’s value after the “shock therapy” reforms of the early 1990s.

Until only a few years ago, it was common to pay in dollars in shops and restaurants. People still do for apartments and cars. Most bank machines issue dollars as well as roubles.

But the rouble has stabilised since Vladimir Putin became President in 2000. He announced this month that by July 1 it should be fully convertible for the first time since the Bolshevik Revolution in 1917.

Such a bill will also have a great impact on Russian tax law, if memory serves, as there are many instances where costs and prices must be quoted in foreign currency. Then again, I'm no tax expert, so I may very well be wrong.

One item I take issue with is the idea that u.e. vary between dollars and euros, depending on rates. The euro has been worth more than a dollar for, it seems, at least a couple of years, and I've not been in any shops during my infrequent visits to Russia where one u.e. hasn't equaled one dollar. (There are other ways to screw foreigners, the most popular being to jigger the exchange rate in favor of the house.)

Still, it sure will be strange to see the ruble traded on foreign currency exchanges.

Cheers...