(Xinhua) -- The Bank of Tanzania (BoT)
on Wednesday moved to clarify reasons behind recent depreciation
of the Tanzanian shilling against the U.S. dollar, attributing
it to a fall in foreign exchange earnings.
released by the country’s central bank also sought to defuse
tension against the backdrop of discussions in newspapers and
social media, with fears that the shilling was in crisis due to
foreign exchange reserves being inadequate.
"The Bank of Tanzania wishes to inform the public that the
current movement in the exchange rate is a seasonal phenomenon
related to low foreign exchange earnings from tourism and export
crops," reads the statement in part.
BoT, the country’s finance sector regulator, said the
depreciation of the shilling is a common trend that usually
normalizes in the second half of the year when earnings from
tourism and exports pick up.
"In addition, the U.S. dollar has recently been appreciating
against major currencies.
"The Bank of Tanzania also wishes to inform the public that
the country has adequate foreign exchange reserves, which are
sufficient to cover 4.9 months of imports of goods and
services," the statement intoned.
"It should be noted that exchange rate in Tanzania is
determined in the market based on demand and supply of foreign
The BoT periodically participates in the market to smooth out
volatilities in the exchange rate that are not in line with
BoT will continue to monitor developments in exchange rates
with a view to ensure that participants in the foreign exchange
market adhere to rules and regulations governing the market, the
Cyprus Central Bank says
"vindicated" by Paris court decision on FBME
NICOSIA Cyprus (Xinhua) --
The Central Bank of Cyprus (CBC) feels vindicated
and is completely satisfied by a decision by the Paris-based
Arbitration Court which turned down an application by the owners
of FBME bank claiming a compensation of 1.44 billion euros for
the discontinuation of its operations, CBC spokeswoman Aliki
Stylianou said on Thursday.
"The decision is proof of the correct and effective moves
made by the management and the personnel of the Central Bank in
handling the case," she said.
The statements by the spokeswoman were an indication of the
magnitude of the relief the arbitration court’s decision brought
to CBC and Cypriot government officials.
As the Cypriot Attorney General Costas Clerides pointed out,
Cyprus was spared a large amount of money equaling about 7.2
percent of its Gross Domestic Product.
The arbitration started in 2014 after Lebanese brothers
Ayoub-Farid Michel Saab and Fadi Michel Saab, who indirectly
owned the bank, applied to the Arbitration Court seeking
compensation from the Cypriot government for failing to protect
They cited a bilateral agreement between Cyprus and Lebanon
for the protection of investments as the legal basis of their
FBME, which was the holding company of FBME Bank incorporated
in Tanzania, was set up in 2005 to provide ordinary banking
business in Cyprus.
However, CBC revoked its license in 2013 after the USA
Financial Crimes Enforcement Network accused FBME of
facilitating financial transactions for multinational organized
crime organizations and of becoming a channel for the financing
of the Shiite Hezbollah group.
In December 2015, CBC also fined FBME 1.2 million euros for
failing to comply with the anti-money laundering law.
FBME was consequently placed under administration and then
under resolution by CBC, which in April 2016 also initiated
proceedings for the compensation of bank clients who had
guaranteed deposits of up to 100,000 euros.
Clerides welcomed the decision of the Arbitration Court,
pointing out that it confirmed that "Cyprus Central Bank acted
as a prudent supervisory authority and that the (Cyprus)
Republic did not violate any of its obligations".