The uncontrollable foreign exchange rates causing inflation and hardship on consumers and travelers is worrisome. The current monetary policies based on the concept of free market economy do not seem to suit the economic realities in the country.
The need for Gambian experts and policy makers to rethink on this issue is essentially of fundamental importance in economic management. This is not a developed country and the principles of economic, monetary and financial instruments of development are not the same with that of a developing economy like The Gambia. Hence the debates in official circles continue on divided lines. How can we bank on donor money to stabilize the depreciation of the Gambian Dalasi against foreign currencies. The real problem is that we definitely have a structural problem in that our currency is under pressure from the high debt due to high borrowing, inflation, traveling demand, etc. From a non expert point, and as a concerned citizen among others, it is my considered opinion that the current liberal policy which gives credence to the market forces, is not a feasible and realistic option in tackling the foreign exchange situation. We cannot continue to react to the effects of a fragile economy. Solutions to the depreciation of the Dalasi are not found in monetary policy but in agriculture policy in my opinion. The enabling environment to transform the country from a consumer society to a production and export based society is the key to sustainable development. Apparently, the dependency on donor money and remittances to enhance foreign exchange is not working in the public interest as long as inflation is taking a high toll on the people. There is no economic plan which tackles the depreciation of the Dalasi and the current high cost of living. When the previous government left, the dollar was at $45, and now the dollar is at D62.50 or more.
The CFA was between D225 \ D250 for 5000 CFA. and not the CFA is between D500 to D550 for 5000 CFA. All other foreign currencies have gone up as at now. We cannot possibly claim that the two economic circumstances of the two Republics are different. The Gambia is still a consumer society and a tax-based economy. With Covid 19, more money was received by the country. Apart from importing wheat from Ukraine, I am not sure that we import fuel and food from Russia. These two situations therefore cannot possibly be a claim for the difficulties faced by the country in terms of essential commodities. Economies of the world are adjusting to the global crisis. We cannot therefore pretend that we don't know how to be free from poverty and raise the standard of living of the people.
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The impact of international assistance in African states have not been helpful enough when the poor continues to be poor and the rich continues to be rich. To improve the foreign exchange situation, a number of steps must be taken by the government. First, is to revamp the agriculture sector, fisheries sector and tourism sector to excite growth and economic development. Government to put an end to the black market and to order that all foreign exchange transactions be conducted through the banking system. The Central Bank of The Gambia to give exchange rates orders to OPINION all commercial banks in the country. The GRA, Immigration, Police, SIS to monitor and stop businessmen and foreigners in particular and other agents from taking hard currencies out of the country through the airport and border points. A limit to the amount that can be allowed to exit from the country can be determined by the Central Bank of the Gambia.
Government to take bold measures on fiscal discipline, less government expenditures, less overseas travels, reform of the public service to make it efficient and effective, restructure and engage performance contracts for public enterprises, etc. On the foreign exchange problems, we have reached a stage whereby current policies have neither been based on economic realities of the country nor on economic logic towards ameliorating the hardships on the people. The cost of living is taking a high toll on the people and one can feel economic depression everywhere in society. This is a third world country and the concept of a liberal economy does not augur well with the objective conditions of the people and their station. We must have our own homegrown strategies for development. The problem is that the intelligentsia are always full of doubts on the way forward. The innocent continue to suffer from economic hardships.
D.M. Badjie Political Scientist / Dev Consultant
