Putin calls for currency union with ex-Soviet allies

Russia's President Vladimir Putin (R), Kazakhstan's President Nursultan Nazarbayev (C) and Belarus' President Alexander Lukashenko meet in Astana on March 20, 2015 (AFP Photo/Alexei Druzhinin) (Rai-Novosti/AFP)

Astana (Kazakhstan) (AFP) - Russian President Vladimir Putin on Friday called for a single currency with the Kremlin's closest ex-Soviet allies despite fraying ties in the region which is struggling with the fallout from Moscow's economic crisis.

Putin urged closer integration for his flagship Eurasian Economic Union -- which also includes Belarus, Kazakhstan and Armenia -- as Moscow scrambles to limit the damage from Western sanctions over Ukraine and tumbling oil prices.

"We think the time has come to discuss opportunities to form a potential currency union," Putin said at a meeting with his Kazakh and Belarusian counterparts in Kazakhtan's capital Astana.

"Working shoulder to shoulder, it is easier to react to external financial and economic threats, and protect our common market."

Political and economic ties between Moscow and the bloc's two other founding members, Belarus and energy-rich Kazakhstan, have been strained by the recent economic woes and jitters over Russia's alleged military involvement in Ukraine.

"Major trials have befallen our union," said Kazakh President Nursultan Nazarbayev at the outset of the summit, while arguing for deeper cooperation.

The economic union -- a pet project of Putin's -- has been slammed by the West as an attempt by the Kremlin to revive its Soviet empire.

The debate over whether Ukraine would opt for closer ties with Europe rather than the Russian-led bloc is at the heart of the current crisis.

Nazarbayev said the trio were "interested in Ukraine becoming a strong, stable, independent state with territorial integrity," at the conclusion of the meeting.

The summit, which followed bilateral meetings between Nazarbayev and Belarusian leader Alexander Lukashenko and Putin was initially scheduled for March 12 but was cancelled by Russia during a 10-day disappearance by Putin from public view that had sparked rumours over his health.

Ahead of their separate meetings with the Kazakh president, both Putin and Lukashenko backed Nazarbayev to extend his 23-year grip on power at snap presidential polls in April that he looks set to cruise through.