 A Common Currency for Belarus and Russia?Vassili Prokopenko, Etibar Jafarov and Anne Gulde No 2004/228, IMF Working Papers from International Monetary Fund Abstract: This paper discusses costs, benefits, and implementation challenges of a possible currency union between Belarus and Russia. It shows that Belarus and Russia are economically closely linked but nevertheless do not fulfill all "optimal currency area" criteria, especially the macroeconomic symmetry condition. Furthermore, we argue that the different speeds of economic liberalization over the past decade have resulted in different economic structures, with Belarus still dependent on monetary financing of budgets and industries. However, a final cost-benefit analysis also needs to consider that currency unification may bring substantial benefits from reduced transaction costs, an improved macroeconomic environment in Belarus, and by acting as a catalyst to advance structural reforms in Belarus. Keywords: WP; country; government; Belarus; enterprise; currency union; monetary union; Russia; monetary unit; common currency; authorities of Belarus; Belarusian authorities; liquidity crisis; issuing country; government in Russia; Russia authorities; authorities of Russia; Monetary unions; Currencies; Exchange rate risk; Lender of last resort; Government debt management; West Africa (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2004/228 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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