No foreign exchange crisis in T&T: Browne

Trinidad and Tobago is not facing a foreign exchange crisis. Minister in the Ministry of Finance Mariano Browne made the emphatic statement in the Senate Tuesday in response to the opposition's concern over the state of the country's financial reserves.

Opposition Senator Wade Mark wanted to know why the Central Bank was asking businesses to limit access to access foreign exchange.

"There is ample evidence that we would be able to meet all our requirements," Browne stated.

He added, "There may come a period when we will have to sell some more out of our reserves to be able to make good the trade requirements in the marketplace and those would be seen as short blips in supply but our foreign exchange cover and our import cover remain buoyant," he assured.

Browne pointed out that in May 2009 the total international reserves held by the Central Bank was US$8.9 billion. He said that figure increased to US$10.2 billion when the reserves held by commercial banks in T&T were included.

He admitted a slippage of about $1 billion and that the reserves held by commercial banks have taken a hit of approximately US$300 million.

However he maintained that the current reserves would allow for 11 months import cover.

"When one looks at the summary balance of trade and the summary balance of payments position, T&T is in net surplus. We are earning more than we are spending," he said.

Browne said that while it is true that there is increased demand for foreign exchange things are not as bad some have suggested. he noted that there is no black market for foreign currency, which is a sign that there is stability.

He said businesses are on a shorter credit leash because of the global financial situation where foreign suppliers are offering shorter credit terms.