Shortage of USD: GCCI should engage commercial banks, banking association – BoG
The Bank of Guyana, in response to a release from the Georgetown Chamber of Commerce and Industry (GGCI) on foreign currency shortages, has advised the body to engage Guyana’s commercial banks and the bankers’ association on its concerns.
The GCCI, in a press release issued earlier on Thursday, accused the Central Bank of failing to intervene in the ongoing foreign currency shortage issue.
This matter has been raised more prominently in recent days though the GCCI said members of the private sector have complained of a lack of US dollars since 2019. And the GCCI further accused the Central Bank of having scant disregard for local businesses.
“An independent intervention is needed since the GCCI has lost confidence in the leadership of the Bank of Guyana or its capacity to implement policies that will guide Guyana’s financial sector to support growth being experienced in the real sector,” the GCCI stated.
The Bank of Guyana, however, rejected those accusations.
“The GCCI appears to be of the mistaken impression that the BoG exists to ensure that foreign currency is available to their membership at the times that they demand and at prices that they demand.
“This is simply not how an open market economy operates, and is simply not how foreign currency availability and pricing are determined where floating currencies are concerned,” the Bank of Guyana said in a letter of response issued hours later.
The Bank of Guyana also reminded the GCCI that it is an independent central bank whose mandate is clearly defined by law.
Though it is responsible for fostering domestic price stability through the promotion of stable credit and exchange conditions, the Bank further noted that Guyana’s laws stipulate that the Guyana Dollar is a freely floating currency, traded in a market whose prices are determined by prevailing market conditions, that is to say demand and supply.
And so, the Bank’s statement posited: “The GCCI’s energies would be better spent engaging either the banks or the bankers association, who are also members of the private sector, with a view to better understanding the factors that influence the availability and pricing of foreign currency in the domestic market.”
In a recently invited comment, Bank of Guyana Governor Dr. Gobind Ganga refuted complaints about the shortage of foreign currency and suggested that hoarding might be the reason people, businesses, and some commercial banks are making this claim.
But GCCI President Timothy Tucker, took to Facebook on Tuesday to complain that in spite of the assurances from the Bank of Guyana, he has been waiting for the last two weeks to get U.S dollars from a local bank for a wire transfer to pay a supplier.