Earlier in September Armenian Prime Minister Hovik Abrahamyan proposed that the state members of the Eurasian Economic Union (EEU) use the Russian ruble instead of the U.S. dollar in trading with one another. Abrahamyan said it is necessary to promote national currencies and reduce dollarization.
The experts describe Abrahamyan's proposal as an attractive initiative which will possibly be hard to bring into reality. However, Mikayel Melkumyan, Deputy Head of the NA Standing Committee on Economic Affairs, believes the issue is at the political level and the sanctions the West imposed on Russia will only accelerate the transition to national currencies in trading within EEU and, subsequently, the establishment of a single currency.
"The trading of gas and oil products in Russian rubles will benefit Armenia. Armenia annually imports gas and oil products costing over 650 million dollars. And now that dollar is appreciated it is a pretty heavy burden for Armenia whose overall volume of import amounts to 4.5 billion dollars," said Melkumyan.
The amount of Russian ruble in the Armenian financial market suffices to pay for gas and oil products. "Every year ruble transfers equal to 1.5 billion dollars come to Armenia. Besides, our exporters working with Russia have already switched to ruble payments. It is essential to have the amount of ruble coming to Armenia sterilized, i.e. ruble should not come to Armenia, be exchanged into dollar or euro and get devaluated. Sterilization will prompt the demand for Russian ruble on the market," said the lawmaker.
Economist Suren Parsyan said it is too early to speak about the establishment of a single currency for EEU states since the possibility of a single currency can be discussed only in 2025.
Some of EEU states have long shifted to trading in rubles with Russia. "Why shouldn't Armenia do the same? Besides, oil prices will be fixed in Russian rubles at the domestic rate and plus the logistics. So, gas and oil prices in Armenia may go down," said Parsyan.
The experts believe the transition to Russian ruble trading will take place quite soon and "the economic crisis and sanctions on Russia will curiously promote the financial integration."
Arshaluis Mghdesyan, Editor-Coordinator
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