Major foreign currency crisis looms

As Guyana continues to grapple with the loss of foreign correspondent banking, a major crisis is developing with the availability of foreign currency.

Monday a number of local banks confirmed that for the first time in years, they are restricting customers who want to remit large sums of monies abroad to pay for services and goods, among other things. Some of them are even calling cambios and each other for supplies. The shortage has been exacerbated by a number of factors, not least among them the severing of ties of a number of foreign banks with local financial institutions. A number of under-performing sectors; the fact that some of the neighboring countries have been coming here to buy up foreign currencies and pressure on the illegal drugs trade have all been compounding a situation which can only get worse. One local bank had just over US$350,000 to trade with yesterday and is being careful not to allow customers to send above US$10,000.

One businessman who wanted to send US$30,000 recently had to make do with US$10,000 and was told that he was being placed on a waiting list. There are many more stories like this. Government recently unveiled the national budget for 2017 and the figures for big earners rice, sugar and forestry were dismal, to use words of the Government. These are the big earners that bring in large quantities of foreign exchange to the country. From time to time when the need arises, Government, through the Bank of Guyana, has been releasing quantities to the local banks to steady the exchange rates.

(Kaieteurnews.com)