Importance In today's environment of the global financial and economic crisis, the debate about the relationship between the degree of central bank independence and effectiveness of ongoing monetary policy has intensified. Though, the principle of independence is defined de jure as the basic one in the central banks' operations of the majority of the States, de facto, that principle is not like that. Very often, it leads to the economic situation destabilization. This problem is of particular importance for developing countries, which banking legislation and the central banks' activities need for further improvement. It fully applies to the countries of the Customs Union: Belarus, Kazakhstan and Russia. The level of independence of their central banks does not match the similar parameters of the developed countries' central banks; it also slightly decreased during the period of market transformations. Objectives The strengthening of integration processes within the framework of the Customs Union of Belarus, Kazakhstan and Russia, and the transition to coordination of the main elements of monetary policy brought the necessity to identify the areas to ensure the central banks' independence, carrying out comparative analysis of the degree of their independence, as well as to identify the areas of its improvement. Methods On the basis of the two most common methods (GMT-index and CWN-index), I have assessed the index of independence of the central banks of the Customs Union in development. I came to a conclusion that it is preferable to use the CWN-index that takes into account a greater variance of characteristics and nonequivalence of independence criteria. Results I showed the evolution of approaches to the definition of central bank independence, described its characterizing criteria and made an assessment of the degree of central bank's independence. I defined the reasons of the changes that took place during the period of market transformations and identified factors affecting the degree of central bank's independence, including those, which defy formalization. Conclusions and Relevance Banking legislation of the Customs Union countries, set up in the early 1990s, was consistent with international practice in general, and it contains the basic provisions to ensure their central banks' independence. However, starting from the early 2000s, a downward trend in independence of the central banks of Russia and Belarus began to show up, that was due to the emergence of the requirement of compulsory participation of the Government in the formulation of monetary policy, an increase of its impact on the central banks' activities, and the expansion of the motives for the dismissal of the head of central bank and other issues.
Keywords: central bank, central bank independence, central bank independence criteria, monetary policy, GMT-index, CWN-index, Customs Union
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