Government keeping close eye on foreign currency availability

The Government is keeping a close eye on the ongoing foreign currency availability issue in the country, as delays by businesses to access the currency persists.

At a press conference on Thursday, Vice President Bharrat Jagdeo explained that there appears to be two main factors contributing to problem of foreign currency access. He said there is a shortage of physical banknotes, and the second factor involves cash exports by some traders, which puts additional strain on the available currency on the local market.

“We are monitoring it and as I said before, there are people who put in multiple request, a lot of the businessmen, when we look at the framework, we will see multiple requests, and they will go to five banks and put in the same request at several banks. So, we have that and we have a number of people who still think they can beat the system especially  not the Guyanese so much, but there is a groups that we are looking at to create leakages for goods that are going to Trinidad, we still have that as a pressing issue,” Mr. Jagdeo stated.

Mr. Jagdeo said although those who are taking large sums of notes out of the country declare it, it still puts a strain on the availability of physical currency because bank drafts are easier to manage.

“We have adequate funds to inject in the banking system, there is a bigger shortage of notes and that is pushing up the cost of the exchange rate for notes and the reason is that the illicit users, they want to buy the notes because they can’t come through the banking system and some of these Chinese companies and others they go and buy the notes because they are prepared to pay more for the notes so its creating a shortage of the notes more,” Mr. Jagdeo said.

Despite the current delays, the Vice President assured that there is no systemic shortage of foreign currency and that the government remains focused on maintaining stability within the financial system.

In October, President Irfaan Ali announced several measures that were intended to monitor the country’s foreign currency as well as credit card spending.

The Government has been seeking to better understand the main drivers of the increase in demand for foreign currency here in Guyana.

During a meeting with Executives of local Commercial Banks in October, the President said in 2024 alone, the Government injected some US$334m in the local market to clear the foreign currency demand, with the demand rising to more than US$1.2 Billion this year.