Gambian Dalasi In Crisis While On The Verge of Being Rejected


The Independent (Banjul)

January 2, 2001

Banjul

The Gambian currency the dalasi has fallen sharply against other foreign
currencies in recent months, prompting several businessmen in the country to
prefer using other currencies in their business transactions. The situation is
said to be felt more in the rural areas.

Inhabitants in the border villages of North Bank Division said they have been
alarmed by the dalasi's downward spiral whose value they said continue to drop.
At the end of June last year, the Gambian currency was D11.32 to the US dollar
and D18.06 to the British pound.

It experienced some further drops in the last quarter of 1999 - a trend which
continued into 2000.

Towards the close of this year the dollar and the pound rose up further,
exchanging at D14.35 and D21.09 respectively. Other currencies like the French
Fanc and the CFA have also rallied significantly against the local currency.

In the black market the picture doesn't seem to be assuring either. One dollar
is equivalent to D15 while one pound is exchanged at D22.

CFA500 make up for D10 while the French Franc is at D201.

Local businessmen have expressed disquiet that the Dalasi is in danger of being
rejected by foreign businessmen wanting to invest in the country but found its
depreciating value a disincentive.

In a round-up tour of the border villages in the North Bank Division, people
there told The Independent that they have observed with "helpless shame" as the
CFA Franc was being preferred to the dalasi. They asserted that on several
occasions, businessmen especially foreigners rejected the Gambian currency in
favour of the CFA Franc.

They revealed that this happened particularly during weekly market days (lumos).

Those who preferred other currencies said they were driven towards those
currencies by the "ailing and declining" Dalasi.

A middle-aged businesswoman who wished to remain anonymous claimed that many
counterfeit versions of the Dalasi have swarmed the market, dampening confidence
to deal with the local currency. Alhagie Amadou Sargh a resident of Tawa in
Lower Baddibu told The Independent that a Mauritanian businessman in their
village caused a stir when he refused to accept the Dalasi in exchange for items
he was selling.

Mr. Sargh said he made an inquiry of whether it was proper to reject the dalasi
within Gambian territory but was "advised to report the matter to the police at
Kerewan". According to Sargh the only currency the Mauritanian businessman
accepted was the CFA Franc.

Amat Joof a resident of Dimbuga said the rejection of the Dalasi in their area
has brought serious difficulties to the people who depend on it to bargain for
food and other essential items. He claimed that most of the rejections were from
Mauritanian businessmen in the area.

He pointed out that his daughter-in-law nearly fought with a businessman after
he rejected her local currency notes.

A middle-aged man who also preferred anonymity asserted that the Dalasi's
rejection could not at this stage remain unnoticed by the police. "I blame the
Alkalolu and the police, who are aware of the situation" he noted.

"The police should be brought to the picture" he suggested. "If this trend
should continue into the next year our currency would just be a trash" said
another businessman who trades between the urban and rural areas.

The Kerewan police could not be reached for comment. However, an insider at the
Central Bank confirmed that the Dalasi is in more trouble of a downward slide
and acknowledged that it is faring badly against the CFA Franc.

Although he said he did not know the reason for the currency's decline, but he
would not rule out instances of counterfeiting as one cause.

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