Historical Sketch

The Turkmen territories came under rule of the Khanate of Khiva and the Emirate of Bukhara in the 16th century. In 1865-1876, the Uzbek-inhabited territories were annexed to the Russian Empire. They were combined to form the Turkestan General Governorate, but Bukhara and Khiva (Khorezm) retained independence under a protectorate. In the civil war after the 1917 Russian Revolution Soviet Turkestan emerged and joined the USSR in 1922 as Autonomous Soviet Republic of Turkestan, to which Bukhara and Khorezm were added two years later. In 1925, Turkestan was broken up and divided into the Soviet republics of Turkmenistan and Uzbekistan. In 1991, Turkmenistan withdrew from the USSR and declared independence.

Monetary History Overview

After independence in 1991, Turkmenistan continued using the Soviet currency for two more years. Only when Russia demonetized the Soviet Ruble in July 1993, Turkmenistan transformed the former State Bank of the USSR, which had been nationalized in mid-1992, into a central bank. In November 1993, the 1st Turkmen Manat was introduced as national currency, and the Soviet and Russian money was withdrawn within three weeks. The Manat was floated in May 1994 and depreciated by a factor of 1000 within less than two years, and then by another 50% during the remaining 1990s. In April 1998, the Manat got pegged to the US Dollar and remained frozen for a decade. In April 2008, a currency reform was announced. In preparation, another 63% devaluation was done, which stabilized the currency for the next six years. Beginning of January 2009, three zeros were cut, and the 2nd Turkmen Manat became the new currency unit. In 2015, the overvaluation of the Manat had to be corrected by 18%. The currency has remained stable since.

Turkmenistan joined the International Monetary Fund (IMF) on 22.09.1992.

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