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US$35 injected into banking system to address foreign currency shortage—VP Jagdeo
Kaieteur News- Vice President Bharrat Jagdeo announced on Thursday that the Bank of Guyana has injected another US$35 into the local banking system to address foreign currency shortage in Guyana.
Vice President Bharrat Jagdeo
Thursday’s intervention is the second time in nine months that the government was forced to inject millions of US dollars to smooth out the market. Last year June, the government said it injected US$80M to stabalise the market. At his weekly press conference on Thursday, Jagdeo said, “We study the market, we study the balance that is in all the banks and we only address mismatch between revenue flow of currency and demand for currency”.
He added, “As I said before we have the capability of putting as much foreign currency into the banking system as is needed to meet legitimate demands.”
However, according to the Vice President, while his government can pump foreign currency in the local market, it will do so in a measured way. “…because we don’t want to cause an appreciation of the currency if you put too much money at once you cause an appreciation of the currency and that could ultimately lead to the Dutch disease, it’s bad for the agriculture sector, it’s bad for manufacturing’, Jagdeo said.
A bank telling Double ‘D’ there is no foreign currency
Government’s injection of the US$35M comes after businessmen complained that the shortage is causing disruption in their trade and has resulted in goods to be exported being spoilt. They called on the government and local banking system to come clean and say “what is really going on with the availability of foreign currency in Guyana”.
Businessmen also claimed that despite the injection of millions by the government previously, it had done nothing to alleviate the shortage of foreign currency in the country. One of the businesses whose goods have been held-up for more than three weeks now due to the unavailability of foreign currency, Double ‘D’ trading and Distribution Limited, decided to go on the record, sharing the hardships it is facing. The business imports perishables mainly onions and potatoes and according to its owner, (name provided), the company’s trouble to source foreign currency began last year November, just a few months after the government was forced to inject US$80M into the local banking system to address the same situation. “My goods are spoiling on the port and I had to dump millions of dollars”, he said before later adding “The banking, the system and government must tell us what is going on moving forward. It is not good for investment”.
(US$35 injected into banking system to address foreign currency shortage—VP Jagdeo)
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