* Ukraine's hryvnia to remain parallel currency till
* Exchange rates vary widely in shops, restaurants
* Russia consolidating hold on Black Sea peninsula
By Gabriela Baczynska
SIMFEROPOL, Ukraine, March 24 Annexed by Russia,
Crimea took the rouble as its official currency on Monday, but
confusion over the exchange rate meant the hryvnia was still the
main form of money changing hands.
The transfer was part of a swift consolidation of Russia's
hold on the Black Sea peninsula, which voted in a referendum on
March 16 to become part of Russia and was annexed from Ukraine
five days later. Ukraine said on Monday it would evacuate its
troops and their families, effectively acknowledging defeat.
The Bank of Crimea, created last week by the local
parliament but lacking a formal address, website or phone
number, set the exchange rate at 3.8 roubles per one Ukrainian
hryvnia until April 1. That value that will be used for all
public budget calculations, including taxes.
But in Simferopol, Crimea's main city, the rate ranged
widely. At some banks, shops and restaurants it was as low as
2.6. At a small shop in the nearby village of Perevelnoye, it
"I'm ready to accept roubles in principle, I even went to
the bank in the morning to check out the exchange rate. But
nobody has wanted to pay in roubles yet," said Elvira, a manager
at a small jewellery store in central Simferopol.
"I'm not changing the prices yet because they told me in
Sberbank it's 3.07 roubles for one hryvnia, while I was
expecting 3.38. So let's wait and see," she said.
The Bank of Crimea publishes currency exchange rate
information, based on that of the Russian central bank, on the
website of the Crimean finance ministry (www.minfin.crimea.ua),
which is still registered on a Ukrainian Internet domain.
Neither the local government in Simferopol nor the Bank of
Crimea were available for comment on the currency switch.
The hryvnia is due to remain a parallel currency until the
end of 2015, and many businesses refused to accept the rouble at
all on Monday.
Crimea's ethnic Russians, a narrow majority, see their
annexation by Moscow as a promise of prosperity, fed by Russian
state coffers that dwarf those of Ukraine.
Russian Finance Minister Anton Siluanov said last week that
Crimea's estimated 55 billion rouble ($1.53 billion) budget
deficit would be covered with funds from the federal budget.
But some of those standing queues at cash machines on Monday
- a common sight in Crimea after banks put limits on cash
withdrawals as the military stand-off escalated - were worried
that prices would rise.
"Everything will be more expensive," said Yelena
Vladimirova, a pensioner queuing at a Sberbank ATM.
"Unfortunately, that's inevitable when switching currencies.
Latvia had the same thing with the adoption of the euro," she
said. "But I guess we've been through so much that we'll go
through this all the same."
(Editing by Matt Robinson, Larry King)