 The Ukrainian Money Syndrome By Scott Lewis |
With elections approaching and the eyes of the international community on us, news reports frequently mention that the IMF, World Bank, EU and other organizations are demanding change from Ukraine. It is perhaps less well publicized that Ukrainians are demanding change as well - exact change.
It may well be an issue more tied to politics than to economics, but there is a distinct difference between the way that a person raised in the West and his Ukrainian cousin approach money. A born-and-bred capitalist will accept any form of remuneration he can put his hands on. Even personal checks of dubious value and IOUs have a place in his financial world.
Ukrainians, on the other hand, look askance at every kopeck that comes their way, mentally if not physically testing the money to ensure that it is not something printed for the occasion. With all due respect to the law enforcement community, counterfeiting Hr 5 notes is the least of the country's economic issues.
Not to be too harsh, much of the Ukrainian skepticism is understandable. Most Ukrainians have survived massive political transformation, hyperinflation and bank failures. Many lost lifelong savings and millions bring home pensions that would have been acceptable in Soviet times, but which in present-day Ukraine fall far below anyone's estimation of a poverty line.
In the U.S., the millions of aging citizens who remember the Great Depression of the 1930's could well identify with Ukrainians, with one large difference: while many Americans lost both money confidence in their banks and financial markets, few permanently lost confidence in their government. By contrast, Ukraine's government has not, by and large, earned the trust or moral support of its citizens.
With three years of Ukrainian money-handling experience under my belt, I too have learned to examine every banknote, lest I be unable to pass it on. The habit had become ingrained, until standing at an airport currency exchange counter in Hurghada, Egypt I was reminded that life was fundamentally different outside Ukraine. The cashier exchanged my crisp $100 bill for a stack of the oldest, filthiest, most dog-eared banknotes I had ever seen. When I impulsively began to hand them back, the cashier smiled reassuringly and told me, "Don't worry. They're OK."
He obviously had dealt with the Ukrainian Money Syndrome before. And the cashier was right: in several trips to Egypt, I've never seen a new banknote and I've never had one of the crumbling brown bills turned down. Egyptians, like most other people, see cash as just that - cash. Never mind if the bill is torn, has been written on or is taped together, so long as it holds together long enough to take to the bank.
Not so in Ukraine, where a wrinkled, worn, damaged or defaced bill - what I prefer to think of as experienced money - is lucre non grata.
Nowhere else on Earth have I met a culture with
a currency fetish like Ukraine's. While it is understandable that foreign currency be in reasonable condition, disqualifying a bill for a small tear,
a pinhole or an ink mark is downright silly.
It ought to be embarrassing to refuse exchanging a $100 bill because Franklin's mug has been eroded by too many days in someone's wallet. Perhaps that is why the folks who work in currency exchange booths are obscured behind mirrored glass.
A cynic might reasonably conclude that declining defaced bills is a profit center for banks, which will accept less-than-pristine notes at a 10 percent discount from face value. What do they do with the cash they collect? Send it to the NBU, which forwards it to the U.S. Federal Reserve, where bills will minor imperfections are good as gold.
But the Ukrainian Money Syndrome extends to more than imperfect specimens. Ukrainian merchants view the process of making change for a purchase with almost what amounts to disdain. Give a clerk Hr 15 to pay for an item costing Hr 12.36, and the clerk invariably asks, "Do you have Hr 2.36?" One has to wonder whether the same mentality extends to larger purchases. Is the oligarch troubled to dig into his silk-lined pockets for the coins necessary to settle up the invoice on his new Mercedes?
Ukraine's obsession with currency and its often backward, customer-unfriendly reluctance to make change for customers may improve as workers receive better customer service training. But it must improve if the country is to abandon the habits of
a cash-strapped economy and take its rightful place among economically competitive nations.
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Read also previous issue' articles:
Danone Nations Cup
Ukraine and Property Rights
UKRAINE. Which Way to Go?
Capital’s Minibuses Need Shake-up
Ukrainian Woman in Power
Foggy Forms and Silly Signs: Why Ukraine Needs An 'English Brigade'
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