From the soum-coupon to the soum: how was Uzbekistan's national currency introduced?

In autumn 1993, a shopper entering a bazaar in Tashkent could have two kinds of money in their wallet: the old Soviet rouble and the new, colourful "soum-coupon". Within a year both had become history, and their place was taken by the soum we use every day today. How was this path travelled, and what did it mean for the accountant?

Why was a country's own money needed?

Money is not just paper; it is a tool for managing the economy. Whoever issues money gains the ability to manage the amount of money, interest rates and price stability. After the Union broke up, the newly independent states faced a choice: stay in the common rouble zone or issue their own currency. Uzbekistan chose the second path, but it did so not in one stroke, but in two stages.

Stage 1: the soum-coupon (1993–1994)

According to the Central Bank's official information, from 15 November 1993 to 1 July 1994 an interim currency, the "soum-coupon", served as the national monetary unit.

During this period the old money did not disappear at once. As the Central Bank writes, from 1 January 1994 the circulation of USSR State Bank notes of all denominations issued in 1961–1992 was completely prohibited. After that, the soum-coupon became the only legal tender inside the country.

The word "coupon" itself signalled that this money was temporary: it served as a "bridge" during the transition to the new national currency.

Stage 2: the birth of the soum (1 July 1994)

By Presidential Decree No. PF-870 of 16 June 1994 "On the introduction of the national currency of the Republic of Uzbekistan into circulation", the soum was introduced as the official currency from 1 July 1994. The exchange ratio: 1 000 soum-coupons = 1 soum (Central Bank, Government Portal, yuz.uz).

That is why 1 July is remembered as national currency day. For the soum's 10th anniversary the Central Bank put into circulation a 100-soum coin of the 2004 design, and on 1 July 2024 the 30th anniversary of the national currency was celebrated.

The next major turning point: the 2017 currency liberalisation

One more date holds a special place in the history of the national currency. According to Reuters, most foreign exchange restrictions were lifted from 5 September 2017. In its 2018 report, the IMF assessed this reform positively, in particular free access to foreign currency and the unification of the different exchange rates. Today the Central Bank's monetary policy concept states that the exchange rate is in a free-floating regime.

Then and now

Example: moving the "Bahor" shop's balance sheet into the new money

The example below was compiled by the author; the figures are hypothetical. It shows what work an accountant does when the monetary unit changes.

Nodira opa, the accountant of the hypothetical "Bahor" grocery shop, had drawn up the balance sheet in soum-coupons as at 30 June 1994. From 1 July all amounts had to be divided by 1 000 and converted into soum.

Check: assets 1 850 + 7 400 + 3 150 = 12 400 soum, liabilities and equity 9 000 + 3 400 = 12 400 soum. Because every item is restated at the same ratio, the balance sheet equality is not broken, and neither the property nor the debt actually changes: only the unit of measurement changes.

Practical lesson: when reviewing documents from a period when the monetary unit changed (for example, 1994 reports in an archive), first find out in which unit the amount is written. Otherwise it is easy to draw the wrong conclusion that the same company "shrank a thousand times" within two months.

Link with the previous period: in the 20th century currencies were tied first to gold, and then, in the Bretton Woods system, to the dollar; in the 1990s, as new states issued their own money, they looked for an answer to the same question again: what secures trust in money? The next stage: the move from cash to card and mobile payments.