By George Obulutsa, NAIROBI Kenya
Burundi’s central bank has suspended the licenses of all
foreign exchange bureaus in the central African nation, saying the move was
aimed at weeding out those flouting official exchange rates.
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| Central Bank of Burundi |
Burundi has
experienced a shortage of foreign exchange since 2015 after a political crisis
that started when President Pierre Nkurunziza announced in April that year that
he would seek a third term in office. He went on to win the election the
following July.
The European
Union suspended financial support to Burundi in 2016, saying Nkurunziza had not
done enough to resolve the political and economic crisis.
Burundi’s
central bank said in a statement late on Monday it had withdrawn licenses for
foreign exchange bureaus for violating rules that allow them to trade currency
within an 18% margin of the official exchange rate of 1850 Burundi francs per
dollar.
“The
licenses which were given to the foreign exchange offices are withdrawn,” the
central bank said in the statement seen by Reuters on Tuesday, adding the ban
would take effect on Feb.15.
The bank
said commercial banks would however be allowed continue exchanging currencies.
Police
briefly detained more than 40 money traders in late 2019, accused of violating
the foreign exchange trading margins.
Typically
traders turn to limited dollar supplies from neighboring Democratic Republic of
Congo, which they were selling on the black market.
The franc
has appreciated to 2,500 per dollar from 2,900 in recent days, and traders said
this would continue gaining ground due to traders slowing imports, in part due
to travel restrictions to China due the coronavirus epidemic. - Reuters
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