Sat | Jul 20, 2019

Opposition calls on Gov't to respond to foreign currency market woes

Published:Wednesday | July 10, 2019 | 10:01 PM
Mark Golding, opposition spokesman on finance and planning

The Opposition People's National Party (PNP) is raising an alarm over an acute shortage of supply in the foreign exchange market, "with major businesses in the real sector being unable to source foreign currency from authorised dealers for the past two weeks".

The real sector refers to real economic transactions of an economy.

In a release this afternoon, the Opposition also noted that the Bank of Jamaica (BOJ) has reported that the value of the Jamaican dollar slipped to J$135.48 to US$1.00 as at close of business Wednesday, a depreciation in value of more than three per cent in the first 10 days of July.

“At times like these the BOJ must not delay intervening to restore calm to the foreign exchange market," Mark Golding, opposition spokesperson on finance and planning, said in response.

"The current arrangements governing the market also need to be reformed, so that the needs of the real sector are not subordinated to the interests of the financial sector."

Golding said the frequent volatility over the past year was undermining business confidence and damaging the country's economic performance and prospects.

"This is evidenced by the fall in the Business Confidence Index reported this week, which cites fluctuations in the foreign-exchange rate as a key determinant of the fall in business confidence," he said.

"A majority of firms indicated that this volatility is undermining their ability to make long-term plans. Firms willing to invest in new plants and equipment has also declined.

Golding demanded that the Government respond now to a situation he argued has been allowed to continue for too long, "and avoid it leading to further damage to confidence, growth and the overall economy".