DOLLAR SHORTAGE : BoT allays fears

TANZANIA, Dar es Salaam THE Bank of Tanzania said it will continue supplying US dollars in the Inter-Bank Foreign Exchange Market (IFEM) to ensure oil marketing companies and other stakeholders have easy access to the foreign currency.

Equally, it urged the companies to source foreign currencies from bureau de change, commercial banks and markets so that they continue to import petroleum products in the country.

“We have reasonable amount of dollars that is why we continue to sell them in Inter-Bank Foreign Exchange Market in order to address the high demand of the foreign currency,” the BoT Governor Mr Emmanuel Tutuba told the ‘Daily News’ on Wednesday.

The BoT reaction follows the latest cap prices for petroleum products announced by the Energy and Water Utilities Regulatory Authority (EWURA) which indicated a sharp rise in prices.

According to EWURA the changes in the prices have been caused by the challenges of the availability of US dollars and changes in fuel levy, prices of petroleum products in the world market and premiums in importation of petroleum products.

Mr Tutuba said recently the central bank sold six million US dollars in the Inter-Bank Foreign Exchange Market (IFEM) to address the dollar demand and the huge sum went to the oil marketing companies.

“I advise them to continue sourcing the foreign currency in bureau de change, banks and other markets so that they continue with their business… BoT will continue to sell dollars in IFEM, whenever they are available to curb the high demand, “he said.

Mr Tutuba detailed that the shortage of dollar is a temporary problem facing many countries in the world due to the effects of global shocks, particularly the war between Ukraine and Russia, Covid-19 and climate change, which have largely impacted the global commodity prices.

He said the central bank is currently taking various measures to address the shortage of the foreign currency including initiating export credit guarantee scheme.

“BoT continues to create an enabling environment to increase the availability of dollars by exports credit guarantee scheme, a system which guarantees the quality of the products for competition outside the country,” he added

Mr Tutuba also pointed out another measure initiated by the BoT as the purchasing of gold in the country and selling it abroad to earn more dollars.

“The Central Bank will continue to strictly manage foreign exchange reserves, to meet the objectives of the financial markets,” he emphasised

The indicative prices announced by EWURA which were effective since yesterday  showed that  the retail prices of petroleum products in Dar es Salaam, Tanga and Mtwara  have increased.

In Dar es Salaam the price of petrol is 3,199/-, diesel 2,935/- and Kerosene 2,668 for August which have increased compared to the July prices which were he in 2,736/- , 2,544/- and 2,829/- respectively.

“The prices in Tanga region is 3,245/- for petrol, diesel 2,981/- and Kerosene 2,740/- for August while in July the prices were 2,724/-, 2,760/- and 2,875/-

In Mtwara the prices of petrol is 3,271/-, diesel 3,008/- and kerosene is sold at 2,714/- compared to July prices which were  2,809/- ,  3,000 and  2,901/-respectively  .

According to EWURA Director General, Dr James Mwainyekule the wholesale price of petrol in Dar es Salam is 3,067.10/- per litre, diesel 2,803.56/- and kerosen 2,537.61/-. In Tanga the price of petrol is 2,985.40/- and diesel 2,849.80 while the price of petrol in Mtwara is 2,662.38/- and diesel 2,867.94/-.”

He said all retailers and wholesalers are required to sell petroleum products at prices indicated by the authority.

“Legal action will be taken against any retailer or wholesaler who fails to comply with these instructions,” he insisted.

Moreover, the authority also reminded wholesalers, retailers and the general public to adhere to various issues including all petrol stations to display petroleum product prices on clearly visible boards.

“It is an offence not to have prices published on boards located in clearly visible places in front of petrol stations. Failure to adhere to this directive will attract punitive measures from EWURA,” he said.

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