ASHGABAT: The energy-rich former Soviet republic of Turkmenistan devalued its currency against the US dollar by 18 percent, in the latest sign of contagion among Russia’s neighbours from the plunging rouble.
The secretive Central Asian country has vast oil and gas reserves and has erected grandiose marble-clad palatial government buildings and sports complexes, but failed to raise living standards for most of its five million people. Yesterday, the website of Turkmenistan’s central bank published the rate of 3.50 manats to the US dollar, up from 2.85 manats, a depreciation of 18.6 percent. It gave no explanation.
The devaluation came as the plunge in value of the rouble, linked to Western sanctions over Ukraine and falling oil prices, sent shockwaves through former Soviet republics.
All currency exchange offices and banks in the capital Ashgabat were closed yesterday, even at the airport, officially due to the public holiday. At one exchange point in the city centre that is usually open 24 hours, people regularly drove up to check whether it was operating.
Earlier, Turkmenistan’s oil and gas ministry announced petrol prices had risen by 60 percent. The rising price did not immediately lead to long queues at petrol pumps. A litre of one type of petrol cost one manat, while previously it cost 62 tenge (22 US cents under the previous exchange rate). No immediate explanation was given for the sudden price rise.
President Gurbanguly Berdymukhamedov was bullish on the economy in his televised address just before midnight Wednesday saying Turkmenistan had “achieved high levels in all areas of the economy” and strengthened its “economic might.” Rumours of an approaching devaluation had been circulating for several months since the autumn, prompting many to change their savings into dollars.
AFP
