Arusha. Former Bank of Tanzania (BoT) Governor Edwin Mtei,
yesterday advised the central bank to use foreign currency reserves in a
bid to prevent the shilling from depreciating further against the
greenback.
The local currency has of late tumbled to as low
as Sh2,015 against the US dollar. Mr Mtei said in an interview with The
Citizen that the BoT was the sole organ which could bail out the local
currency at the moment.
“This is a technical matter, not a political one,”
said Mr Mtei, adding that blames levelled against foreigners were
politically motivated.
The founding leader of the opposition party,
Chadema, called on the central bank to make use of its experts to
stabilise the Shilling.
Mr Mtei, who resigned following a similar
depreciation, said the central bank was duty bound to assist the
government in controlling imports including by supplying foreign
currencies to that effect.
“A country needs several imports, including paying
for different equipment, expatriates, spare parts and running
factories. The BoT must chip in,” he said.
Mr Mtei said accumulation of the foreign currency reserve alone did not give credit to the nation.
“It’s like you have the US dollar, yet you lack
the capital required for protecting your currency,” said Mr Mtei,
stressing that he had been doing the same thing when he was the
governor.
“I begged to differ with the (Father of the Nation) Mwalimu Julius Nyerere on the same matter before I resigned,” he said.
Mr Mtei said he managed to stabilise the local
currency which rose to Sh12 against the US dollar without attracting any
complaints from outsiders.
An economic consultant based in Arusha Simon
Mapolu, blamed the depreciation of the Shilling on the slack financial
policies and laws in place.
He, however, concurred with Mr Mtei that the BoT
was duty bound to use the foreign currency reserves for rescuing the
local currency, saying there was no use accumulating the foreign
currency reserve when the value of the Shilling was depreciating.
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