Arbitrage opportunities have been miraculous in the past month as new currencies have taken hold in the five states of the former Soviet Union's Muslim southern rim, an extraordinary conjuncture of state bungling, Russian economic bullying and high-minded Western ideological intervention.
Take the Snickers chocolate bar, an omnipresent free market item of apparently obvious worth. On the first day one of the new currencies was issued, a diplomat went from kiosk to kiosk asking for a price: one wanted 2,800 roubles, another 10,000 roubles, a third dollars 2 and the last refused to sell. 'The worst bit came when we got the quotes for a cocktail party,' he said. 'Even though it was always a price quoted in hard currency, it went up from dollars 300 to dollars 3,000.'
In the short term, the losers are the 50 million people of Central Asia. Former Soviet peoples had enough trouble understanding the Western concept of money. Now nobody knows the value of anything, and they are learning the hard way how to cope with a collapse in living standards.
'I don't feel this is a real currency. Prices are very high. I buy all the products, but less of everything. There are no medicines either,' said Vazira Akhmesinova, looking at a truckful of cabbages whose price had risen 50 per cent in a fortnight. The peasant salesman was getting richer, but the former radio scientist's institute had collapsed with the Soviet system and she was now getting by as a secretary.
The Central Asian states' great leap into independent currencies was a hurried affair few can explain. Did the International Monetary Fund (IMF) blackmail them into taking on a fiscal responsibility for which few were prepared? When Moscow demanded all foreign currency and gold reserves in return for membership of a new rouble zone in October, was it deliberately forcing an ungrateful Central Asia to walk the plank? Or did Moscow believe that even if the area had the guts to go it alone, it would soon fail and come running back to rule by mother Russia?
The answer seems to be that although the former Communist leaderships may not have asked for the independence thrust upon them with the collapse of the Soviet Union in 1991, most are now determined to create real nation-states. The choice was inevitable after Russia struck out alone with a new currency in July and Central Asia was overwhelmed by pre-1993 Russian currency.
For now, Russian neo-imperialists have kept control over the strategic land of Tajikistan, a monetary black hole and the only state of the old Union to stay in the new rouble zone. The wizards from the IMF have landed up with Kyrgyzstan, a country with virtually no resources that the IMF persuaded to launch its new som in May as part of an effort to show Central Asia a model of fiscal reform.
The prospects look brighter in the other three more resource-rich states that launched their currencies in November. Economically best-off is Kazakhstan, which produced the most successful - and certainly the prettiest - new currency, the British-printed tenge.
Confused Uzbekistan produced a transitional unit called the som-coupon, an unlovely Monopoly money of uncertain value. President Islam Karimov flies to Europe with Uzbek gold bars to show off as guarantees to would-be investors, but at home even officials are in the dark. The government is trying to maintain parity with the new Russian rouble while the state-controlled Uzbek press talks of both a return to the rouble zone or, more probably, an exchange for a new Uzbek currency.
'Uzbekistan's idea of a free market is to arrest the street marketeers and send police goons out to the bazaar, offering to trade roubles one-to-one for som-coupons,' one diplomat said. In fact, the rate has swung wildly from 1:2 to 1:5.
Turkmenistan has seen confusion and a fall in the value of its new manat. But by balancing an idiosyncratic dictatorship, apparent obeisance to Russia and a steady flow of income from its trans-Russian shipments of natural gas, its medium-term future seems fairly secure.
The multiplication of currencies in Central Asia will probably speed the divorce of economic systems from Russia, diplomats say, especially since suppliers are increasingly asking for payment in hard currency. But the currencies are also exacerbating divisions within Central Asia itself.
The West has no magic wand to wave. The IMF is negotiating stand-by agreements and macro-economic stabilisation programmes, but it has seen that financing reform even in liberal Kyrgyzstan is a bottomless pit. Western chancelleries have already shown in the Caucasus that if push comes to shove, they have little political will to compete with Russia in its old territories.
Russia will thus be dominant for some time, controlling shipment of most exports and imports either by pipeline or truck. Alternative routes through China, Afghanistan, the Caucasus and Iran are problematic and only beginning to develop. But ethnic Russians are leaving the region and, even if it wants to, Moscow cannot rule as before.
Central Asia is now far more in charge of its own destiny. Shop shelves are filling up and people are learning to make economic choices that one diplomat said was 'the beginning of wisdom'. But the people face years of lower living standards. Many have still not yet accepted this, a fact that may yet unseat some of the old Communist leaders.
'Our currency, the som, means a kind of fish in Russian,' said one unhappy Kyrgyz man. 'The som may now be floating, but we are sinking.'Reuse content