The government of the Gambia has been alerted on the forex currency market exchange rate fluctuation and forex availability in the economy by the National Economic Council.
On Wednesday, Gambian leader Adama Barrow presided over the Economic Council briefing on the background of the developments in the foreign currency market and measures taken by the monetary authority to restore normalcy in the market.
The bank made consultative meetings with Banks, Money Transfer Operators, and Foreign Exchange Bureaux on current operational issues that have been noticed in the forex market.
A statement made available to stated that the Central Bank of The Gambia briefed the forum on the current market trends in the global economy, the sub-region, and the domestic economy.
“Global market developments impact local market conditions. It was revealed that some countries in the region have inflations as high as 40% compared with The Gambia, which though registered 14.8% by the end of March 2023, advised that The Gambia should not be complacent with its lower inflation rate.
“The bank informed the meeting that in the last seven years, apart from South Africa, the Gambian Dalasi has been the most stable currency in the region,” the statement said.
The statement added that additionally, the council was informed that the Forex movement was mainly demand-driven, and its sources, such as remittance, were still high and were affected by informal transfer channels.
The statement pointed out that the figures for tourism receipts had done well despite not reaching the pre-pandemic level and demand for CFA associated with festive periods (Eids), coupled with imbalance trade flow largely accounted for the hike in CFA, adding there were ongoing efforts by CBG to close swap deals to facilitate the growing buoyant trade with the CFA zone.
The Gambia Revenue Authority also reported that despite challenges, there was growth in both domestic and international trade. The challenges outlined included bottlenecks at the port of Banjul, causing delays and people resorting to land shipment.
The meeting concluded that the Central Bank finalize regulations to regulate the forex market through the stringent application of the reference rate and the operating margin.
It also urged stricter supervision of Money transfer Operators, the parallel market, and strengthening the financial regulations in managing the demand and coordination with market participants and stakeholders.
The meeting agreed that the dual tariffs toll regime be reintroduced at the Senegambia Bridge.
Council also discussed possibilities to explore Diaspora investment opportunities by Gambians living abroad to spur remittances and investment in The Gambia.
President Barrow emphasized that all possibilities must be considered to solve the growing concern about rising cost prices (inflation) and the availability of forex in the country to address the observed market abnormalities.
“In the long term, take concrete measures toward import substitution by production, productivity, and value additions,” he cautioned.