A comment from one of my friends in relation to a post a few days ago about buying things in a dollar only shop in Moscow set me reminiscing about the change in what was and was not allowed in Russia in the period I spent there.
By the time I made my first visit to Moscow in December 1994 the dollar only shops had already disappeared. Anyone could have dollars to spend; the restriction against Russian’s holding US currency had been repealed; it was just a question as to how one might get ones hands on them.
It was a period of such rapid change that I recall that when I tried to research guide books before my trip, the only ones in the shops still recommended taking cigarettes as gifts for local contacts. I didn’t know much, but I knew that Philip Morris and BAT were already trading extensively in the newly opened market.
In that period of late 1994, early 1995, many transactions were conducted exclusively in dollars; rouble inflation was rampant, so the only way to set a stable price was to use the trusty buck. Prices in the restaurants I went to, in the supermarket I shopped at, were all quoted in USD.
You had to have nice new, shiny bills. Any crumpled or less than pristine notes would be rejected. I became so accustomed to seeing only crisp new notes that when I went to the USA for a visit, I was astonished how scruffy the money was there. Over the years I developed a relationship with a bank teller in the Clydesdale Bank at Piccadilly Circus and would go to her every time I needed currency, as she understood the ‘fresh bills’ requirement.
Some time in 1995 the Russian law was changed to prohibit the use of American cash in any transaction. Infringements would result in a 100% penalty. Showing true Russian flexibility most establishments complied. The prices on the menus and on the shop shelves were still in dollars, but there was a sign over the door that disclosed the applicable exchange rate. As nothing had been done to control rouble inflation, the rate changed daily.
If you paid in cash, you could calculate the number of roubles that would be required; if you paid by credit card you might be charge in dollars, deutschemark or finmark depending on some whim that was never apparent to me.
Then the authorities stepped in again and forbid the use of US dollars to price anything. And once again, natural ingenuity found a solution: the introduction of the universal currency unit. Entirely coincidentally the exchange rate for the ECU to USD was 1:1. After a little bit of reprinting of price lists, everything carried on as before.
Just to show, there’s a way around most obstacles.