The assertive Russian republic plans to make the ruble convertible on currency exchange markets in two years and promised new protection for foreign investors, officials said Friday.
The statements, however, offered little assurance the vast republic could carry out its proposals in the turbulent political climate that has nearly paralyzed power in the country. The comments were made during a seminar on the Russian economy.The Russian parliament also gave preliminary approval Friday to a resolution on transition to a market economy, but then became bogged down in debate on amendments, the official news agency Tass reported.
Economy Minister Gennady Filshin told participants at the seminar the ruble would be made convertible slowly in foreign exchange markets, in order to avoid a sharp drop in value that would leave the U.S. dollar the dominant currency, Tass reported.
He offered no other details of the plan at the seminar, attended by financial experts and would-be investors.
The dollar already has become the currency of choice for a range of transactions, from taxi rides to joint venture investments. Soviet officials have taken measures to try to boost the ruble's value by outlawing foreign currency transactions to halt "dollarization."
Some of the 15 Soviet republics also have said they want to create their own convertible currencies as part of their drives for independence.
Participants at the conference expressed doubt that even Russia, the largest republic, with 90 percent of the country's energy resources, could sustain a convertible ruble on its own, Tass reported.
Russia's justice minister, Nikolai Fyodorov, also said the republic's parliament will begin debate soon on a bill to equalize foreign and Soviet business under Russian law, remove limits on foreign business activity in Russia, and allow foreign capital to be brought freely in and out of Russia.
"Taxation and customs privileges will be granted to enterprises with 100 percent foreign holdings and joint ventures that are ready to re-invest or invest in economically backward regions of Russia," Fyodorov said, according to Tass.
He said 30,000 "revenue inspectors" would be hired to make sure taxes are paid by the emerging private sector businesses.