Suntou, I think we need an independent analyst... Omar has been too
indoctrinated!!!

Any takers out there??? Burama Jammeh... Laye would be a good one too -
finance????

Thanks

Demba



On Mon, Feb 20, 2012 at 11:14 AM, Bolonba <[log in to unmask]> wrote:

>  Demba, don't worry our junior economist is at hand to decipher the
> details. Sinyo kuu buka sinyo karr. Suntou
>
> Sent from my iPhone
>
> On 20 Feb 2012, at 18:54, Demba Baldeh <[log in to unmask]> wrote:
>
>   Laye,
>
> Hmmmmmm!!! this is an interesting position from the IMF and it should be
> worrisome for our little Gambia... I wonder what happened to the good
> economic growth forecast that was recently louded by the World financial
> body? It is certainly starting to trickle bit by bit that all factors use
> to assess the economic health of a nation were not used..
>
> We need an economist to explain the ramifications of this possible
> devaluation... Any recommendations who we can talk to out there?
>
> Thanks
>
> Demba
>
> On Mon, Feb 20, 2012 at 7:05 AM, Laye Jallow <[log in to unmask]> wrote:
>
>>  IMF: Gambian currency may be overvalued
>>
>> http://www.africanews.com/site/IMF_Gambian_currency_may_be_overvalued/list_messages/41132
>>
>> Posted on Monday 20 February 2012 - 10:28<http://www.africanews.com/site/list_message/37237#m37237>
>> Madi Njie, AfricaNews reporter in Serekunda, Gambia
>> *The International Monetary Fund has indicates that the local currency,
>> the Gambian Dalasi, may be overvalued by 17 percent. According to IMF
>> report, "a number of complementary approaches were adopted to assess
>> whether the Gambia's exchange rate is aligned with fundamentals.*
>>
>> These alternative approaches proposed by the IMF Consultative Group on
>> Exchange Rate issues include the macroeconomic balance approach, the
>> external sustainability approach and equilibrium real exchange rate
>> approach.”
>>
>> According to the report, the purchasing power parity approach was also
>> involved in the assessment, pointing out that these alternative approaches
>> produce somewhat different results.
>>
>> “The macroeconomic balance approach suggests that the Dalasi may be
>> overvalued by 17 percent. The country’s underlying current account deficit
>> is 12 Percent of Gross Domestic Product (GDP). The underlying fundamental
>> driving this result is the large fiscal deficits in recent years.
>>
>> Temporary factors such as Government’s financial external payments for a
>> large telecommunications project also played a role. With an estimated
>> current account norm of about 2 percent, roughly in line with estimates in
>> past assessments, a depreciation of 17 per cent would be needed to restore
>> sustainability.”
>>
>> The report outlined that the external sustainability approach indicates
>> an overvaluation of 8½ percent.
>>
>> The report published by Gambia local newspaper- Foroyaa, adds, “With an
>> underlying current account balance of 12 Percent of GDP, The Gambia’s long
>> run net foreign assets would be unsustainable at about -138 percent of GDP
>> in order to bring the NFA to a sustainable level of -70 percent of GDP,
>> that the exchange rate would require a depreciation of 8 ½ percent with a
>> corresponding current account deficit of 6 ½ percent of GDP”, the report
>> states.
>>
>>
>> --
>> -Laye
>> ==============================
>> "With fair speech thou might have thy will,
>> With it thou might thy self spoil."
>> --The R.M
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>
>
>
> --
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