Russia, Belarus agree single currency

Presidents Putin and Lukashenko have taken their biggest step so far towards union

The leaders of Russia and Belarus have agreed the introduction of a single currency for their two countries.

The move was announced after a meeting between Presidents Putin and Lukashenko in the Belarusian capital, Minsk.

Belarus wants support for its weak currency

It is the biggest step so far towards a plan to deepen the union between Russia and Belarus agreed by the two neighbours last year.

But Mr Putin cautioned against haste in the establishment of a union state.

The draft agreed by the two presidents stipulates that the Russian rouble will be introduced to Belarus by 1st January 2005.

A single currency would then follow in 2008.

But the draft agreement still has to be ratified by the two countries' parliaments.

And analysts say even the dates agreed may be unrealistic, given the weakness of the Belarus rouble.

In the meantime, Russia has undertaken to support the Belarus currency, partly by means of a loan.

Caution urged

Despite the draft agreement on currency, the summit showed little other signs of progress.

We should consider our decisions 100 or even 1,000 times but we should not drag them out

Vladimir Putin

While Mr Lukashenko has been keen to moved the integration process forward, Mr Putin reiterated his cautious approach at the summit.

"We must eliminate any public concern in our countries," he said.

"This is a very delicate process and any question in this sphere could be very important.

"We should consider our decisions 100 or even 1,000 times, but we should not drag them out."

Untapped wealth

The Russian-Belarus Union finally came into being in late 1999.

The BBC's Moscow correspondent says that the driving force behind it has largely been Belarus.

But there is a powerful lobby in Russia that is eager to capitalise on its neighbour's still largely unprivatised wealth and its prime position on the border with Europe.

Correspondents say that so far, though, there has been more talk than concrete progress.