In several speeches this week Kazakh President Nursultan Nazarbaev has harshly criticized the U.S. dollar and proposed the creation of a new world currency
under UN auspices and a new regional single currency for the countries of the Eurasian Economic Community
(Belarus, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan).
Under Nazarbaev's plan, the new world single currency would be called the "acmetal" and the new regional currency, the "euras" (an abbreviation of the word "Eurasia").
According to Nazarbaev, the regional currency (as well as the single world currency) would help to protect member countries' economies from the U.S. dollar, which Nazarbaev called "a nondemocratic, nonfree, and noncontrolled currency."
His idea is to create a new supra-national currency that will not be affected by the abrupt exchange rate changes on the international currency markets.
Despite all the grand talk, Nazarbaev's plans are really intended for domestic political consumption.
After thousands of Kazakhs lost their savings after the devaluation of the tenge
last month and property prices have plummeted, Nazarbaev is sending a message to the people of Kazakhstan, assuring them that his government is working on solving the crisis and the dollar is to blame, not him.
It is also a message to other member states of the Eurasian Economic Community that he is ultimately a regional leader, someone also looking out for other former Soviet republics and offering them "fresh ideas."
The idea , of course, isn't really fresh.
During the Cold War, the Soviet Union and Eastern bloc countries used the so-called "convertible" ruble, under the Council for Mutual Economic Assistance.
Essentially, Nazarbaev is offering the same system: all countries keep their own national currencies (that will make ex-Soviet republics happy, as their own, comparatively young national currencies are treated as symbols of statehood and independence) but for transactions between states they would use the "euras." The idea also appeals to the ex-Soviet republics' vanity, in that it might be seen as a rival to the euro.
But it's unlikely the idea will ever get off the ground -- and Nazarbaev probably understands that very well.
-- Merkhat Sharipzhanov