Some old news:
https://en.eadaily.com/news/2015/09/03/ruble-becomes-single-currency-in-donetsk-peoples-republicRuble becomes single currency in Donetsk People’s Republic
Russian ruble has been approved as the single currency in territory of the Donetsk People’s Republic (DPR). The announcement on it was published on the website of the Finance Ministry on September 3.
“Ruble is the only compulsory currency and the prices, tariffs and the budgetary payments have been re-calculated on the basis of the single currency,” DPR Finance Minister Yekaterina Matyushchenko said. At present, she said, ruble accounts for 92% of the DPR budget, while hryvnia accounts for only 8%.
EADaily reported earlier that DPR shifted to a floating rate of the Russian ruble (RUR) on September 3. For the time being, the exchange rate is as follows: 1UAH/3RUR. Earlier, a hryvnia cost 2 rubles. The multi-currency zone in the territory of the DPR was introduced to counteract the blockade announced by Kiev and to stabilize the economic situation. DPR Head Alexander Zakharchenko said the ruble rate was a “cohesive measure necessary to fill the financial market amid transition to the multi-currency system.”
http://www.bloomberg.com/news/articles/2015-09-15/the-central-bank-with-no-currency-no-interest-rates-but-atmsThe Central Bank With No Currency, No Interest Rates, But ATMs
The Republican Central Bank has a governor, a couple of thousand employees and a glass-and-steel headquarters. It also has a bunker in its basement.
Here’s what the nascent, self-proclaimed Donetsk People’s Republic in eastern Ukraine is missing: a financial system. Absent from the central bankers’ toolkit are a currency and interest rates.
Set up 11 months ago, the fledgling institution is the first building block by pro-Russian rebels to manage the economy in the vacuum created by the war to break away from Ukraine. Dependent on almost $40 million a month from their patrons in Moscow just to pay pensions and on a circuitous transfer system via another Russian construct in northern Georgia, the Donetsk officials say they’re making progress.
“We are proud that our bank is working, that we made a processing center,” chairwoman Irina Nikitina, 47, a former chief executive officer at a local bank. She spoke in her office at a building the rebels took over from Ukraine’s Eximbank. “We built the system, we want to improve it.”
Back at the offices of the Republican Central Bank, Nikitina oversees about 2,000 employees, roughly equal to about three-quarters of the European Central Bank’s work force in Frankfurt.
The Donetsk entity acts more like a monopoly commercial bank as the aspiring policy makers learn the ropes. Her deputy, Yury Dmitrenko, said they mostly surf the Internet to learn about central banking mechanisms, using Russian, Ukrainian, Belarusian and European examples.
