Why do businesses keep complaining that they cannot purchase foreign currencies?
Ngan: Overall, the foreign currency supply and demand remains in balance. The supply of foreign currencies from overseas remittances, foreign direct investment and official development assistance (ODA) are big enough to offset the trade deficit. In the first six months of the year, our balance of payments was even in surplus. However, shortages still occur because dollars are being hoarded in many sectors, at businesses, banks and among people. The reason behind the dollar shortage is people’s anticipation of further dollar appreciation. The State Bank must resolutely stabilize the exchange rate to overcome this expectation. LD: What should the Government do to ease the dollar shortage? Ngan: It is really a difficult task. I think that the State Bank needs to open an ‘investigation’, requiring commercial banks to report voluntarily about their foreign currency positions and about businesses’ hoarding dollars. The result of the ‘investigation’ will show the bank how to set up reasonable
