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Russian ruble, US dollar take up 30% of Donetsk Republic’s money supply — DPR head

April 21, 2015, 12:21 UTC+3 MOSCOW
"As of today, the Ukrainian hryvnia accounts for about 70% of money circulation in the republic while the ruble has a share of less than 30% and the US dollar not more than 2%," Zakharchenko said
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© Mikhail Sokolov/TASS

MOSCOW, April 21. /TASS/. The Russian ruble and the US dollar have taken up about a third of money supply in the self-proclaimed Donetsk People’s Republic (DPR) amid Kiev’s economic blockade, DPR Head Alexander Zakharchenko said on Tuesday.

"As of today, the Ukrainian hryvnia accounts for about 70% of money circulation in the republic while the ruble has a share of less than 30% and the US dollar not more than 2%," Zakharchenko said in an interview with the Donetsk News Agency.

The euro and the US dollar are being slowly introduced into money circulation "due to the low volume of sale of the DPR’s goods for these currencies," Zakharchenko said, adding he was confident that the supply of foreign currency would eventually increase through broader trade with European companies.

"There will be an inflow of other currencies into the republic under contracts, which our enterprises have signed, for example, the Khartsyz Pipe Plant and many others, including coalmines. That is, we’re already selling goods abroad. European consumers, including Poles, are buying our coal," the DPR head said.

"That is why, the share of the ruble, the dollar and the euro will be increasing," he said.

The DPR Finance Ministry said in February the self-proclaimed republic might allow the circulation of leading world currencies on its territory due to Kiev’s economic blockade.

"Ukraine has imposed full economic blockade of the republic. In these conditions, our cash inevitably leaves the republic’s territory, which leads to its artificial shortage," the ministry said.

An artificial cash shortage has a negative impact on very diverse spheres of life in the Donetsk People’s Republic, it added.

"Today we can state that along with the hryvnia, which remains the basic means of payment, other currencies available to citizens like pounds, dollars, the yuan, the [Japanese] yen and euros may be allowed for circulation on the territory of the republic," the Donetsk news agency quoted the finance ministry as saying.

Clashes between Ukrainian troops and local militias in the Donetsk and Luhansk regions during Kiev’s military operation conducted since mid-April 2014 to regain control over parts of the breakaway territories, which call themselves the Donetsk and Luhansk People's republics, have left thousands dead and forced hundreds of thousands of people to flee Ukraine’s embattled east.

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