Dr Thugge, while appearing before the National Assembly’s
Finance and Economic Planning Committee on Tuesday for vetting,
said he will work with the National Treasury to issue the dollar
bond to get rich locals and businesses to release the foreign
currency.
“If we can get Kenyans holding dollars in deposit accounts to
release them by buying into the bond, then we will have the
possibility of increasing the liquidity of dollars in the system and
this will help us in building up foreign exchange reserves at the
CBK,” Dr Thugge said.
But Dr Njoroge, whose term ends on June 17, says the government
would be venturing onto a slippery slope with the proposal and a
lot needs to be taken into consideration before the planned bond is
floated.
The CBK governor, while hosting his last post-Monetary Policy
Committee meeting press briefing yesterday, said there is nothing
alarming about the growth of foreign currency deposits in the
banking system. He noted that banks are already using foreign
currencies and so there is nothing to be mopped up.
“The concerns are misplaced. Issuance of a dollar-denominated
bond is not a slam dunk; it is not a sure fire. It risks fanning the
flames of dollarisation in the economy”, Dr Njoroge said. “If you
look at foreign currency deposits as a share of total deposits in the
banking system, it is about 20 per cent. There’s no real concern
from the share perspective.” Dr Njoroge said.
Dr Njoroge has warned that we will soon be like Zimbabwe if we take that route of “dollarizing” the economy. He stabilised the dollar at about 100 bob for 10yrs ya Uhuru so anajua kire anasema.
Though Kamau Thuge has quite the experience on monetary policy I trust Dr Njoroge by a mile on this,he actually mainted the floating dollar rate for a good 10 years,currently we as net importers are really suffering with the high dollar rate,for goods that we would import with 10m now we need 14m,as a business you can imagine the impact on businesses
The best route should be barter trade. America akireta iphone nampatia cassava ama arrow roots. We bypass @sani 's parasitic owners of capital and DpUncle Ruto haslanomics
Umbwa. Ni kusoma hujui kusoma ama ni shida ya comprehension. I was in charge of the Clandestine Operations wing at Vauxhall Cross and one of my minor duties was operating jumpers for the SAS. Later retired to join the British Grenadiers at the rank of Major.
