Hard Currency Parallel Market to Face Large Losses

Hard currency traders in Algiers Square market, still contend that the decision to open the exchange offices by the beginning of April, without enabling them to discharge the large amounts which they got in recent years, would cause heavy losses, especially since the profit margin which these offices will grant, will not jumps over 20% in the extreme cases, while it is likely to be set at 5%, at a time the adopted margin in the black market for the currency reaches 50%.

Square market traders said the traders of hard currency parallel market in Algiers Port Said Square Market, and a number of importers faced the largest loss in their history in the last hours, after the sharp decline in the Euro, Dollar and British Pound price, which fell without warning, as the Euro fell from 200 ZDZ per 100 Euros to 171 ZDZ,  the Dollar from 175 ZDZ to 150 ZDZ, and the British pound from 240 to 210, after news of the preparations to open legal exchange bureaus, at a time when they provided wholesale orders for the European market in accordance with the ladder of foreign currencies’ high prices.

Economist, Fares Masdour, said the exchange rate in the parallel market of foreign currency is governed by rumours, news papers and statements by officials, along the lines with the statement that was made by Algeria Bank Governor, Mohamed Laksaci, last week, when he announced on a presidential decree that regulates the process of opening the exchange offices in Algeria, that will be released in the official Gazette of next April, and the spread of some of the news about the sharp collapse of the hard currency’s market prices, which dropped the value of these currencies, which would cause losses for hundreds of traders and importers that may reach up to 30% the value of goods that are imported from abroad.

“Although importers rely ostensibly on the Bank of Algeria to turn the exchange within the framework of the banking resettlement process, but a large number of them resort to hard currency market in Port Said and 5 similar markets across the national territory for the Euro and the dollar, and some of them made large orders during the past few weeks, by virtue of the expectations of constantly rising prices in the next phase, but they get surprised of an unexpectedly decline after the decision of Algeria Bank governor to accelerate the opening exchange offices.”

“Profit margin which will not be less than 5%, and will arrive at its worst to 20%, when reaching a sharp rise in prices and the scarcity of foreign exchange, and higher demand compared with the offer, which is contrary to the currently approved prices, even in the last few days when the profit margin reached for the first time 50%”.