Only businesses that do not have established relationships with local commercial banks have complained to the Georgetown Chamber of Commerce and Industry (GCCI) about trouble obtaining United States currency, Chamber President Vishnu Doerga says.
“We had a few complaints but that was mostly from clients who said that the banks are giving preference to those persons they have established relationships with,” Doerga told Stabroek News yesterday. The Private Sector Commission (PSC) also informed that it has not received complaints pertaining to shortages of US currency but delays have been mentioned by a few persons.
“The PSC has not received any complaints from companies that they are short of foreign exchange. What is evident, however, is that the banks are asking that companies book the monies a little beforehand,” PSC President Eddie Boyer said, when contacted.
He also explained that persons would have to fulfil a new requirement, “that there be documents submitted, invoices and such.”
The grumbles about delays with the transactions were also received by the GCCI.
Stabroek News yesterday visited two popular privately-owned cambios on Regent Street and on King Street, where US currency was being bought at rates of $205 and $206 per dollar, respectively. Clients changing and purchasing more than US$500 had to show identification.
Asked if they felt there was a shortage of the foreign currency, both operators said no, with one going on to point out that as compared with last year, “business has slowed down and you are not seeing the volume of persons changing.”
In a move to stabilise the foreign exchange market, the Bank of Guyana last week announced that it was temporarily halting the purchase of Trinidad and Barbados dollars from local cambios. In announcing the decision, Central Bank Governor Dr Gobind Ganga said that there is evidence that persons from Trinidad and Tobago, Barbados and in some cases Suriname, are buying large amounts of US dollars here. This situation, Ganga explained, was as a direct result of the economic circumstances in those countries.
Making reference to comparative statistics, Ganga explained that figures show that TT dollars in circulation here significantly rose from about $9.1M in 2014 to $38M today. Circulation figures for Barbados dollars currently peg it to about $13M, up from $8M in 2014.
Yesterday’s checks at the local cambios showed that they were still buying both Trinidad and Barbados dollars.
Ganga also pointed to the Banks DIH purchase of common shares held in its issued share capital by Banks Holdings Limited (BHL) of Barbados at a price equivalent to about US$25M.
Stressing the point that the Bank of Guyana to date has never refused a request from any commercial bank for foreign currency, he assured that “small individuals travelling” and other persons needing legitimate amounts will be able to get those monies from their local banks.
“None of these banks would have approached us for currency and we would have turned them back… every one of the commercial banks would have received currency if they demanded,” he asserted.
And while many persons over the past few days have rushed to buy US from the local banks, Ganga said that in many of those cases persons have not shown legitimate cause for the monies needed.
“We had requested from the commercial banks invoices to substantiate some of these requests. All that we received were some letters requesting a certain amount sent to a commercial bank, or an email or a verbal request. Obviously, if there is a legitimate demand, you would have an invoice accompanying it. You go in there and make a request via letter or verbal or email but you are not able to provide an invoice that here it is legitimate demand. Take, for example, Demerara Bank, you can’t just walk into Demerara Bank and request half a million or $10,000 or whatever without a legitimate invoice. We just can’t go out there and provide the foreign currencies for reasons that we believe are not legitimate,” he said.
“We have seen (as at today) that there is a demand for about (US) $6M, no more. I mean legitimate demand and we are working with the commercial banks, that is of today, and I have indicated to you that situation arose on Monday out of this panic. Because on Monday morning … there was a situation where the net balance was eight plus million US dollars,” he added.
The Central Bank says that while the current requests stands at about US$6M, “The demand is really no demand. (US$) Six million is really no demand.”
