Dear Editor
IN the wake of reports from the Bank of Guyana that there is excess foreign currency in the system, the question arises: Who are we to believe? Minister of Finance Winston Jordan, Bank of Guyana Governor Dr Gobind Ganga, top bank officials or the many concerned and frustrated businessmen who are not getting their requests for foreign currency fulfilled, based on the exchange rates being touted by the Central Bank?

Intensified calls from several of the very concerned businessmen have been increasing as their frustrations grow, after not being satisfied with the responses they have been getting from their respective banks regarding their demands for foreign currency. The questions are: who is lying? Who is being deceptive? Bank of Guyana, the Minister of Finance, the banks in Georgetown or the concerned and frustrated businessmen?

It was reported in May 10, 2017 Kaieteur News that, “After several media reports of a shortage, Central Bank has been able to successfully stabilise the foreign currency system.”
According to Kaieteur News, officials at the bank had told the newspaper that there was “even an increase of U.S. dollars in the system”! The officials said that the excess was between US$10M and $20M. The selling rate on that day was between $208 and $210 for US$1 at most financial institutions.
The senior officers said, “While there were reports that there was a shortage in the system, we have always maintained that this was not the case. We have said on several occasions, that there was money in the system, but various tactics were being employed by a few…”

Based on several investigations carried out by KN in the past at selected banks and cambios, all indicated that some banks were reporting to customers that the U.S. dollar was not in abundance. And it is because of this “discrepancy in reports”, that some very concerned businessmen who depend on regular foreign currency acquisition to conduct business internationally, are refuting the Central Bank claims.

One large importer of heavy-duty mining and agricultural machinery, declared, “How can we do business? Who is being exploited?” This is after he had personally experienced the frustration of attempting to purchase foreign exchange at the publicised rates of G$208 for US$1. “When I check with Republic Bank, Citizens’ Bank and GBTI…they all had exchange rates of G$216.50 to G$218 for US$1.”

On February 2, 2017, the Bank of Guyana issued a Cabinet-certified directive to licensed currency dealers, which include commercial banks and non-bank cambios, to limit the spread between the buying and selling rate for the U.S. dollar to no more than $3, while instructing commercial banks to restrict credit card purchases in foreign currency to non-business purchases.

The report said, “The inflow of U.S. dollars declined in 2016 due to drops in non-gold export sectors, lower remittances, and less FDI (Foreign Direct Investment) compared to previous years, while demand for dollars has remained steady or possibly grown, resulting in a shortage.”
The Central Bank head said that he has the figures to prove that reserves at the Bank of Guyana have improved from approximately US$598M at the end of 2015, to about US$625M at the end of 2016, representing an increase of US$28M.
Regards
Ras Leon Saul