|Amadou Colley, Governor|
The Governor is also the Chairman of the MPC that meets every quarter to review reports on the economy, its performance and remedial measures, where needed, but measures that are quite often ignored by the dictatorship that is the thorn on the side of a struggling economy.
In December 2013, external reserves stood at $170.3 million, equivalent to 4.1 months of import cover, down from $195.8 million in December 2012.
The Governor is reporting that reserves went down from $160.3 million in October 2013 to $ 132.6 million in end-October 2014, equivalent to 3.1 months of import cover from 4.1 months barely 12 months ago. It means Gambia will have to prioritize its external obligations, and with the agriculture and tourism sectors expected to perform poorly, we agree with the Governor's prognosis of the economic outlook as being bleak.
The regime's external obligations include the all-important servicing of its external loan accounts with the World Bank, African Development Bank, the Islamic Development Bank to name a few. Defaulting on loans/credits repayments can result in suspension which will bar access to loan facilities.
Dwindling reserves are not the only challenges facing the economy. Inflation has also been on the increase to 5.6% in December 2013 with food prices rose to a high of 7.3% in October 2013 before easing to 6.6%. The domestic debt which we have also addressed continues to rise at alarming rates further fueling inflation.
Following the Office of The President's ill-advised fray into the forex market in 2013 to the extent that fixing rates from State House against the advise of the IMF, caused panic that saw a precipitous depreciation of the dalasi against the US Dollar by 14.4%, the Euro by 21.0% and the Pound Sterling by 14.7%.
The resultant drop in confidence in the forex market still resonant to this day because the few small forex operators left are still not convinced that Jammeh is still not manipulating the market from his home village of Kanilai.
Even the Governor admits bleak outlook for the economy going forward. The two most important sectors of Agriculture and Tourism are both expected to perform poorly because of the late and poor rains and the Ebola outbreak in neighboring countries respectively.
The regime is always finds it convenient to blame external factors that they have no control over for poor performance, as the Governor has done in the case of the dwindling reserves, but very slow in pointing out the internal factors that is under the control of the regime like the ballooning domestic debt that increased to $ 13.9 billion (39% of GDP) or 25.1% increase from 2012.
Prudent monetary and fiscal policies, as recommended by the IMF, will go a long a way in starting to address the problem but this regime's insatiable thirst for deficit spending is standing in the way of putting our economic house in order, a condition that will only deteriorate further as long as Yaya Jammeh stays in power.