All Over the Globe

Regime of Free Fluctuation of Tenge

The Comments by Deputy Chairman of the NB

Iskander Beisembetov (National Bank)

Almaty, April 5 (Specially for THE GLOBE)

The first thing to begin with is to clarify the difference between the two strategies which are often mistook as something common by many people, e.i. the devaluation of a currency and introduction of the regime of free fluctuation of a currency. Both are designed for the restoration of the broken links of the cost of a national currency and new conditions of running the economy. Let�s note that, while orienting at the policy of devaluation, National Bank ought to determine the rate of devaluation taking in to account a variety of different contradictory factors. On other hand, under the regime of free fluctuation of a currency, only demand and supply of national currency and hard currency will determine the course.

I believe everyone knows the problem of tenge devaluation emerged since August 18 last year. However, at that time it was absolutely impossible to make prognosis on the depth of fall of Russian Ruble. More over, to peg Tenge to Ruble would kill our financial and commodity markets.

Now, after more than seven months, Dollar became not only the main means of saving money but seems to be ready to push the national currency out of the circulation.

The question arises: �Who gains profit from the artificially high rate of Tenge?�

The answer is � only importers win from it.

The correction or the rate of Tenge is determined by the necessity to support domestic producers.

There is a great variety of opinions (from 20% up to 150%) on how Tenge should be tackled: someone is concerned by the problems of producers, while others are worried by the profit extracted at the securities markets. The mechanism of self-regulation should be introduced in the currency market.

The Fall of Teenage: the Experts� Viewpoint

Mikhail SERGEYEV

ALMATY, April 5 (THE GLOBE)

�These measures ought to be undertaken even last year. Nevertheless, this did not happen, though the process of devaluation of national currencies in CIS countries started long ago�, said Ermukhamet Ertysbayev, Director of Kazakhstan Institute for Strategic Studies.

In his opinion, the introduction of free rate exchange of tenge could be explained by political reasons, by the past presidential election in particular.

He said if the former policy concerning the national currency continued that would lead to most disasters consequences, to �the black Tuesday.� He believes now it�s important not to emit money, the current mass of moneys ought to be preserved.

�The most negative thing in the current situation is that quite recently, nearly a month ago, an announcement was sounded that no fall of tenge would follow. The promise failed�, said Director General of the Information Agency for Financial Markets.

In the opinion of Andrey Tsalyuk, Kazakhstan, now the country enters a new era, the era characterized by the lack of confidence in the authorities on the part of the professional participants of the market.

�The government and the National bank have been compelled to undertake these measures and they may turn out to be a success. Unhappily, the moral shock seems stronger than the economical one�, he said.

ABN-AMRO Bank Kazakhstan opens the Pension Fund

Michail SERGEEV

ALMATY, April 5 (THE GLOBE)

�ABN-AMRO Accumulative Pension Fund is the first non-state pension fund, established with foreign participation�, the representative of �ABN-AMRO Bank Kazakhstan� stated at the press-conference devoted to the opening of the fund.

According to him, the shareholders of the fund were: �ABN-AMRO Bank Kazakhstan�, JSC �Hurricane Kumkol Munai�, JSC �Geotex� and the Publishing House �Biko�.

�ABN-AMRO Bank Kazakhstan� will be a proprietor of 85% of stocks of the pension fund, while the other shareholders will have 5% each�, he said.