By Tabora Bojang
The governor of the Central Bank of The Gambia has said the country is in a debt distress and cannot continue to rely on foreign loans to finance development.
According to the Ministry of Finance’s microeconomic and debt portfolio report 2021, The Gambia’s total and publicly guaranteed debt stock at the end of 2021 stood at US$1.69 billion (D88.93 billion).
This is in huge contrast with the country’s debt portfolio under the former regime which stood at US$527,088,062 million (D58 billion) in 2016.
Speaking at the Monetary Policy Committee presser at Banjul Thursday, Governor Buah Saidy stressed that the country cannot fulfill its socio-economic obligations and lift citizens out of poverty if it continues to rely on borrowing, because it comes with implications such as inflation and currency depreciation.
“We should be able to produce enough chicken to feed ourselves; we should be able to produce enough rice to feed ourselves and even [produce] vegetables that we import from our neighbouring countries. We have the land; we have the water; we have the young population; and the labour is there. So, we can do it. Likewise, we should be able to have some industries to be able to do some manufacturing and produce things that can be made in The Gambia that we can export whether as services, commodities or material things. This is the agenda that we are trying to promote. We don’t have to depend on loans to develop our country because we are overburdened with loans. We are debt distressed,” Governor Saidy lamented.
He said after taking due cognisance of the fact that the country must look elsewhere and put in the right economic structures to crush our dependence on loans, the CBG developed an economic transformation agenda that sought to boost private sector empowerment and use our domestic resources to develop and build infrastructure.
“This is what will address income poverty, housing poverty, health poverty, education poverty for us and the next generation. And as CBG we want to participate in economic development and work with all sectors in the economy to ensure that enough support is given to agriculture for us to be able to feed ourselves,” he added.
Saidy, a former PS at the Ministry of Finance, disclosed that the CBG will soon launch a capital market that will allow companies to float shares to increase their capital, invest and expand.
“With that [capital market] if we want to build schools, hospitals and roads, the government can create financial instruments that Gambians here and the diaspora can invest in and there will be a return on their income. We have seen it in other countries where they build toll roads and people pay when crossing. We don’t need to go and borrow loans; we can do it ourselves and the money stays here.”
He said henceforth the CBG will aim to increase the financial inclusion rate in The Gambia from 16 percent to over 70 percent by 2025, in a bid to bring financial services to the door steps of every Gambian.
“If that happens, we will be able to produce more and be able to export our resources so that we earn foreign currency and be able to pay for those foreign currencies so the external sector balance is also maintained. The dalasi will also be priced at the right level and the frequent depreciation and imbalances that could arise from not having a stable currency would not happen because this translates directly into inflation and inflation reduces our welfare and the value of our wealth,” he said.