GAMBIA’S CURRENCY TAKES DOWNWARD SLOPE

As at end-December 2011, the value of The Gambia’s currency, the Dalasi, depreciated against all major international currencies, Central Bank Governor Amadou Colley revealed on Tuesday at the quarterly press conference of the Bank’s Monetary Policy Committee (MPC).

Governor Colley

Governor Colley said the Dalasi weakened against the US Dollar by 7.7 per cent, the Pound Sterling 6.9 per cent, and the Euro 8.8 per cent. 

Consumer price inflation, which measures changes in the price level of consumer goods and services purchased by households, depreciated to 4.4 per cent in December 2011, lower than the 5.8 per cent in December 2010.

However, according to Governor Colley, average inflation has declined, albeit slightly, to 4.8 per cent from 5.0 per cent in December 2010. 

Dalasi notes

Inflation, he said, is expected to remain in single digit in 2012 predicated on prudent implementation and fiscal policies as well as the easing of the global food prices.

Data from the Gambia Bureau of Statistics indicate that the Gambian economy grew by 5.4 per cent in 2011, slightly lower than the 5.5 per cent and 6.7 per cent in 2010 and 2009 respectively. 

Provisional data indicate an improved government fiscal position in 2011.  The country’s revenue and grants increased from D5.0 billion in 2010 to D5.2 billion in 2011, equivalent to 16.1 per cent of Gross Domestic Product (GDP), which is the total monetary value of all goods and services produced domestically in the country over a specified period. 

Domestic revenue, comprising tax and non-tax revenue, also rose to D4.2 billion representing 6.9 per cent of GDP.

The Central Bank Governor pointed out that the government’s overall budget balance, including grants, was a deficit of D910.0 million, equivalent to 2.8 per cent of GDP in 2011.  However, this amount is an improvement of the D1.04 billion, 3.5 per cent of GDP, registered in 2010, the CBG governor noted.

The Gambia’s fiscal performance has continued to be challenged by higher-than-projected expenditures by the government that is un-matched by the country’s revenue performance.

As at end-December 2011, the outstanding domestic debt increased to D9.4 billion, or 8.6 per cent from 2010.

 Interest paid on domestic debt accounts for almost 20 – 25% of the national budget, over the years.

The Gambia’s preliminary balance of payments estimated for the first three quarters of 2011 indicate an overall surplus of US$20.1 million, lower than the D52.5 million recorded in the corresponding period of 2010.