Balozi Morwa : Why is Tanzania shilling depreciating- I suspect, among other things is a
a loose control from the government on the currency trading in the
interbank foreign exchange market (IFEM) as one of great source for
the dwindling shilling!
There should be an inevitable monitoring of the government on IFEM as
some local foreign banks have been creating some artifical demand on
the dollar just because of lack of any monitoring mechanisms on
foreign currency in the country.
Even if we boom our exports and lower imports, still we may not get
rid f the problem if monitoring mechanisms on IFEM should not be in
place. Finally, the government may need to consider to strongly reduce
its fiscal spending and public debt as this has been the main
inflation source that have triggered many to opt for cheap imports
than expensive local products.
*Balozi Morwa is a a senior lecturer and economist at the Institute of Accountancy Arusha.
Currently, on PhD study at the University of Dar Es Salaam, Tanzania.
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