20 June 2014

Tanzania: Embittered MPs Want Action Against Currency Substitution

Dodoma — UNOFFICIAL currency substitution (dollarization) has annoyed some members of parliament here, warning the government over further depreciation of Tanzanian shilling if the trend would be left unaddressed.

Mr Luhaga Mpina (Kisesa-CCM) said this on Thursday while debating the government's revenue and expenditure estimates for the fiscal year 2014/15, adding that the government must take immediate measures.

He noted that in all African countries where their currency seems to remain strong against the US dollar, there are strong financial policies in place that do not allow any transaction to be made in another foreign currency.

"Who is behind this unofficial currency substitution? If we think that our shilling has lost value then we should choose one of the foreign currencies and make it official, otherwise if we allow dollars to be used alongside our shilling then we are doomed," he said.

Mr Mpina noted that with all the Bureau de Changes in the countries, it should be odd for people to be allowed to do transactions within the country by using the US dollar.

He called for restrictions on dollar usage in the country and all customers and sellers of various goods be instructed to accept only Tanzanian shillings.

"Our economy will neither get better nor our shilling will appreciate unless we stop the unofficial dollarization of the economy going on in the country," he said.

Earlier, Ms Lucy Owenya (Special Seats - Chadema) also reacted bitterly on the matter saying that the government should be more serious and ensure that no transactions are done in the country using US dollars.

"The use of dollars in domestic transactions is dangerous, making payments using dollars is as good as killing our own currency and digging the grave for our economy," she said.

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