Pay with the ruble-tenge – Kommersant

The increase in the share of Russian trade operations in national currencies is limited by the ratio of imports and exports with a particular country, as well as by the effect of capital restrictions. An alternative way to make payment transactions, however, could be the use of digital currencies, participants in the profile session of the Eurasian Economic Forum said yesterday. In the EAEU, such currencies are being developed by the central banks of Russia and Kazakhstan – it is assumed that their launch will reduce the costs of cross-border payments and increase the efficiency of trade, although it will require solving a number of issues – from exchange rate problems to the development of special foreign trade digital currency instruments.

The process of debanking (disconnection from global payment systems) has intensified and has the character of fragmentation of the global financial system, First Deputy Chairman of the Central Bank Ksenia Yudaeva said at a session on international payments and digital assets of the Eurasian Economic Forum held yesterday in Moscow.

An alternative to traditional channels using correspondent accounts of commercial banks (interaction with Russian banks and payment systems is limited here by the sanctions applicable to them for the military operation in Ukraine and the risks of secondary sanctions for counterparty banks), the participants of the session called digital currencies – in the EAEU they are developed by regulators of the Russian Federation and Kazakhstan.

It is assumed that the launch and use of digital currencies in cross-border settlements will be able to increase the speed of transfers and reduce transaction costs. The bill on the use of the digital ruble will be adopted in the first reading in June, said Anatoly Aksakov, head of the State Duma committee on the financial market.

According to Ksenia Yudaeva, the specifics of such operations are already being considered by international financial organizations – 90% of the world’s central banks are experimenting with the creation of digital currencies, it is technologically possible to use them in international settlements – at the same time, for the needs of cross-border settlements, the possibility of introducing “special digital currencies” is also being considered, to which foreigners can have access. The experts will also have to solve the issues of exchange rate during such operations, added the first deputy chairman of the Central Bank. In Kazakhstan, the use of digital currencies in cross-border payments is planned to be tested this year. “Digital currencies will create a fundamentally new mechanism for making settlements between countries,” said Deputy Chairman of the National Bank of Kazakhstan Berik Sholpankulov. According to him, now the national regulator is preparing a “pilot” to launch the “digital tenge” platform for payments on social benefits and public procurement.

In the meantime, bilateral trade in national currencies is limited primarily by the balance of imports and exports – the use of national currencies is possible only in the part where trade is balanced – therefore, market participants prefer to work in the “universal” dollar and euro. Settlements in national currencies, however, can only be a temporary solution – in the long term, an expansion of the clearing zone will be required, notes Oleg Solntsev, head of the monetary policy analysis department of the CMASF.

For Russian companies, the only “friendly” currency with large turnovers in both export and import transactions is now the yuan – but due to the continued capital restrictions in China, transactions between the onshore (mainland) and offshore (Hong Kong) markets are still difficult. This distinction also affects the Russian market for currency swaps – their volume is limited to offshore yuan, which is already on bank accounts in Russia: mainland Chinese banks do not withdraw their funds to this market, Ksenia Yudaeva noted. In international foreign trade payments and reserves, the share of the yuan is still only 2.3%, although the countries of Latin America and the Middle East declare an increase in the use of the Chinese currency – this may lead to the strengthening of the yuan as the currency of the developing countries of the “South and East”. In China’s external turnover, including Hong Kong, the share of the yuan has already exceeded the share of the US dollar (48% versus 47%), Ms. Yudaeva noted.

Operations in other currencies of developing countries are actually limited by the balanced part of the trade turnover, as well as by strict measures of national currency control, which often encourages exporters to earn revenue in reserve currencies (this, in particular, hinders the use of the Indian rupee in payments for Russian exports to India) . In the EAEU, however, the share of national currencies in settlements between countries last year increased to 79% (from 74-75%) – and although there are no administrative barriers for such operations, it is necessary to reduce risks and costs when making settlements, said the EEC Minister for Economy and financial policy Bakytzhan Sagintaev. So far, the obstacles are primarily the high volatility of exchange rates and low market liquidity, so exchange rates for currency pairs are often set through cross rates against the US dollar. However, there are prospects for direct trade – the demand for transactions in tenge and rubles on the Kazakhstan and Moscow stock exchanges is growing, the minister added.

Tatyana Edovina