Russian heavy industry gives up rubles

Russia's liquidity crisis is so bad that giant factories and regional governments are conducting commerce using barter - the ancient method of exchanging goods and services.

The ruble is in short supply, first because the government's bought up a ton of money to keep it from collapsing, and second, because there is so little confidence in banks that many people keep their savings in safe-deposit boxes or mattresses, rather than savings accounts.

Advertisements are beginning to appear in newspapers and online, like one that offered “2,500,000 rubles’ worth of premium underwear for any automobile,” and another promising “lumber in Krasnoyarsk for food or medicine.” A crane manufacturer in Yekaterinburg is paying its debtors with excavators...

The Hyundai factory in Taganrog, the southern seaport where Chekhov was born, rolled out a barter promotion on its Web site, offering to trade vehicles for “raw materials,” “high-tech equipment” or “other liquid goods, including finished products of various branches of industry.” Gleb Korotkov, a spokesman for the factory, said he could not be specific about what goods were meant, saying it was a “commercial secret.”

Barter deals seem to be spreading fastest in construction industries. Dmitri Smorodin, who runs a large St. Petersburg building firm, said he thought for two months before announcing in late January that he was willing to accept barter items — including food products — as payment for construction work.

Have Car, Need Briefs? In Russia, Barter Is Back