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Survey: Azerbaijanis most confident in local currency

Business Materials 27 July 2011 20:06
According to a research conducted by the American company Gallup in the former Soviet Union, Azerbaijanis were the most likely to want to keep money in their local currency, with 75% expressing this preference.
Survey: Azerbaijanis most confident in local currency

Azerbaijan, Baku, July 27 / Trend I.Khalilova /

According to a research conducted by the American company Gallup in the former Soviet Union, Azerbaijanis were the most likely to want to keep money in their local currency, with 75% expressing this preference.

"The Azerbaijani manat remained stable during the global financial crisis, partly because the Central Bank of Azerbaijan lowered interest rates from 15% to 2%, increased the allowable amount of foreign ownership in the banks to 50%. Azerbaijan continues to show positive GDP growth and this week reported that its strategic monetary reserves of $40 billion are seven times the value of its foreign debt," Gallup experts say.

Some 14 percent prefer the U.S. currency, and three percent - the euro.

Georgia's strong relations with the U.S. are evident in that a relatively high 38% of residents prefer the U.S. dollar over their own currency and the euro. In contrast, 56% of Russians choose their own currency, and more choose the euro than choose the U.S. dollar.
"Residents of former Soviet Union countries in 2010 for the most part said they would prefer to keep any extra money they have in their local currency, but they preferred U.S. dollars over euros by a margin of 29% to 9%," the experts say.

"This reality may explain residents' tendency to prefer U.S. dollars, though it is also possible that residents' preference also helped establish the dollar as the transactional currency of choice," the experts say. "Still, with the euro weakening in recent weeks and economic challenges persisting in several eurozone countries, this measure will be one to watch as Gallup collects new data each year."

Ten of the 11 countries surveyed use the U.S. dollar for major financial transactions, including the purchase or rental of property or vehicles, with only Moldova relying instead on the euro for transactions such as these. Residents of Tajikistan, Uzbekistan, Belarus, Georgia, and Kyrgyzstan were the most likely to prefer to keep money in dollars, while residents of Russia were the least likely.

Belarusians' relatively low 22% preference for their own local currency may be related to its sharp devaluation in recent years. The Central Bank of the Republic of Belarus raised the exchange rates on its currency in January 2009, lowering the exchange rate against the U.S. dollar by 20%.

Results are based on face-to-face interviews with 1,000 adults, aged 15 and older, conducted in May-September 2010 in Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Ukraine, and Uzbekistan and 2,000 adults in Russia.

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