Nosedive of Kazakhstan currency triggers chain reaction in Central Asia’s financial stability

A fast development tourists in the region should also be aware. Currencies in Central Asia took a nose dive and became unstable this week. The only currency that is stable in Central Asia is the zbek Som due to a broader economical base in Uzbekistan

In Kazakhstan, Central Asia after nose dive of the Kazakh currency, a wave of fear of an economic meltdown has reached almost all neighbouring countries. The Kazakhstan National Bank announced 19 percent devaluation of “Tenge”— Kazakh currency on February 11, 2014, reports Dispatch News Desk (DND).

Currency devaluation will hamper imports and strongly impact Kazakh-China trade balance. Getting pulse from Kazakh marketing, Currency-exchangers in Tajikistan have stopped selling US dollars because situation is already affecting Tajik currency—Somoni that has already lost 3 percent of its value against the dollar since change of Kazakh currency rate.

In the meantime the situation has also jolted Kyrgyzstan and it is expected that Kyrgyz national currency—Som will also face impact and may go down. Kyrgyz Economy Ministry has already indicated that government is facing problems to sustain the value of its currency but did not mention any plan to devaluation of Som.

Central Asian experts believe that poverty will increase in Tajikistan and Kyrgyzstan after this situation as both Central Asian countries are already weak economies and poor management system.