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He made the remarks while responding to questions raised during the Mansakunda Ministerial Town Hall held at the Sir Dawda Kairaba Jawara Convention Centre in Bijilo on Friday evening, organised by the Ministry of Information.
“We have also made revisions to our foreign exchange guidelines, increasing foreign currency flows in the foreign exchange market.”
“People’s confidence has grown on the dalasi exchange rate, its stability and the gap between the parallel market known as the ‘black market’ and the official foreign exchange market,” he revealed.
He said the arbitrariness between the two markets has been greatly reduced, adding that the statistics are about 98 layouts. But he made it clear that parallel markets are “illegal” in law and “must not exist”.
“We announced to them that if they wanted to continue operating, they should register as foreign exchange bureaus with the central bank, but it had little effect.”
He noted that enforcing the law by hunting down and arresting those (black market agents) to put an end to their activities will also create another challenge for the economy.
He said doing so would cause “black market” operators to go underground and hoard currency, affecting the country’s foreign exchange supply and, in turn, the exchange rate.
He explained that in order to avoid putting pressure on the dalasi exchange rate, the central bank urged them to take the initiative to register in the foreign exchange market as they would have equal opportunities.
Speaking on currency, he revealed that the stability of the local currency depends largely on factors such as the availability of foreign exchange in the country and the reserves held by the central bank.
He asked: “Do we have enough reserves to support the country’s exchange rate and meet the country’s needs in international trade and services financing?”
He however noted that foreign exchange supply comes from export earnings, adding that Gambia’s exports are basically small and include groundnuts and some other commodities.
He added that another source of foreign exchange for The Gambia is donor support as well as tourism and diaspora remittances.
He concluded by noting that the factors that affect exchange rates are the same as those that occur in the international economy.
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