PM Sellal: “No Hike In Tourist Allowance For The Time Being”

date 2016/12/01 views 422 comments 0

icon-writer By: Asma Bahlouli /*/ English Version: Med.B.

Prime Minister, Abdelmalek Sellal, said Thursday in Algiers that the Bank of Algeria has adopted a series of measures to regulate the currency exchange market and to revive foreign exchange offices in Algeria.

Mr Sellal, who answered an oral question from a member of the National People's Assembly (NPA), read out by Minister in charge of relations with Parliament, Mrs Ghania Eddalia, recalled the regulatory measures to organize the currency exchange market with respect to the creation of official exchange offices, while excluding by the same token any hike in the tourist allowance in hard currency for the Algerian citizens for the time being.

In this regard, he said that the Bank of Algeria plays a "crucial role" in this area by steering and controlling credit allocation operations and managing financial commitments vis-à-vis foreign investors. 

“The regulation of the foreign exchange market is designed to bring about the best conditions for a rapid growth of the national economy and to ensure the achievement of internal and external monetary stability”, he emphasized.

Mr Sellal also pointed to the content of Central Bank’s Regulation No. 95-08 of 23 December 1995 pertaining to the foreign exchange market, which established the interbank market involving financial institutions, banks and mediating authorities responsible for fixing the official exchange rates.

On the other hand, the Prime Minister stated that the system of convertibility of the national currency, the Dinar, is being put in place "gradually by ensuring the evolution of the external financial situation of the country with on focus the evolution of the external balance of payments" .

As to the guidelines foreseen by the Bank of Algeria concerning the convertibility of the Dinar with regard to the granting of education, health and travel allowances for the benefit of families, the external balance of payments’ situation isn’t propitious at all for the time being”, he underscored.

Regarding the criteria to be taken into account in applying these guidelines, Mr Sellal referred to the adverse impact of the external balance of payments and the scathing decline in oil prices on the "unrealistic convertibility of the Dinar to the profit of families".

Algeria has adopted the provisions of Article 8 of the Statute of the International Monetary Fund (IMF) by finalizing the ongoing convertibility of the Dinar, he said.

With regard to the creation of foreign exchange offices, 46 approvals were granted, of which only 6 are now operational in the market and 40 others have been withdrawn, 13 of which were requested by the beneficiaries. 27 others were canceled because they did not start their activities.

He also pointed out that the lack of interest by investors in the creation of exchange offices was due in the first place to the small profit margin, in particular in the light of the decline in supply of the strong currency by non-residents due to the slump in the volume of tourism activity in the country.

In order to overcome this situation, the Prime Minister insisted on the initiative of the Council of Money and Credit taken in March 2016, related to the adoption of a new regulatory mechanism amending and supplementing Regulation 95-08.

The latter "made it possible to define clearly the status of these offices, their prerogatives while expanding their intervention in the field of foreign exchange transactions", he finally explained.

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