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Local banking system has US$52M available – Bank of Guyana says in response to reported shortage
The Bank of Guyana
Kaieteur News – The Bank of Guyana (BOG) on Wednesday said that the country’s banking system has a total of 52M USD available for transactions to be done, debunking claims that there is a shortage of foreign currency in the country.
“BOG would like to inform the public that while the available funds are not evenly distributed among the banks, and there may be a short waiting period for the transfer of funds, there is enough to cover the cash flow needs of transactions arising from businesses in Guyana,” they said. Further, “BOG has also been injecting US dollars into the banking system and will continue to do so as is necessary. The BOG would like to reiterate that the banking system with an average monthly turnover in excess of USD 500 million, has an adequate supply of US dollars to meet the demand.”
The statement further explained that the, “Bank of Guyana is aware that some businesses are seeking funds to meet the same payments from more than one bank and also there is a speculative queue for foreign currency because of a perception that there is a shortage of foreign currency. Additionally, there is some hesitancy by commercial banks to submit invoices as required by the BOG which is used to monitor the legitimate use of funds.” “Cash flowing to the banks is cyclical, as such there will be periods of excess liquidity and periods of limited supply. The Bank continues to monitor the foreign currency position in Guyana to ensure there is no disruption nor adverse impact on economic activities.”
This publication previously reported that despite numerous complaints of long waiting time at local banks to have access to foreign currency, Vice President Bharrat Jagdeo is saying that there is currently no sustained shortage of the US dollar in Guyana, and his government has seen nothing to indicate such.
He said the administration receives daily reports from the Central Bank and no shortage has been reported. At his Thursday April 4th press conference at Freedom House, the VP was asked by Kaieteur News to comment on the US dollar going scarce and the exchange rate rising over GYD$220. He said that, “The moment we believe that there is a sustained shortage… because we get daily reports from the central bank on these matters. If we believe there is a sustained shortage then we can inject large amounts. We have the capacity to do that. That’s what central banks are for…to smooth out markets and we wouldn’t hesitate to use the Central Bank to smooth out the market.”
Jagdeo explained that the administration believes that it is, “the choppiness of demand when you look at the entire market on aggregate supply and aggregate demand it should even itself out at a rate that doesn’t seem massive.” The government’s current interest is keeping the currency around the historic range. “So what happens is that some banks have more foreign currency because they have more customers and suppliers of foreign currency than other banks and they don’t share their currency so if you’re dealing with one bank etc,” he added.
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