Central Bank Forecasts Economic Growth at 6.5%

This is premised on a strong rebound in agricultural output and the continued growth in the services and construction sectors.

Speaking at a press conference held at the Central Bank's offices yesterday, Mr Bamba Saho, Governor of the Central Bank of The Gambia, said money supply grew by 8.5 percent in the year to end June 2008, compared to 12.9 percent a year earlier.

According to Governor Saho, preliminary data on the execution of the government budget indicates that total revenue and grants for the first six months of 2008 declined to D1.9 billion or 3.6 percent compared to the corresponding period in 2007.

"The decline is attributed to the lower than projected tax and non-tax revenue. Total expenditure and net lending increased to D2.0 billion, or 13.6 percent compared to the first half of 2007. The overall budget balance (including grants) on commitment basis was a deficit of D113.0 million, or 1.3 percent of GDP. Excluding grants, the deficit widened to D164.4 million, or 1.8 percent of GDP," he revealed.

The Central Bank Governor added that the inter-bank foreign exchange market continues to be vibrant as volume of transactions, measured by aggregate sales and purchases of foreign currency, increased to US$1.7 billion at end-July 2008, or 13.3 percent from a year earlier.

"From end-December 2007 to July 2008, the Dalasi strengthened by 7.1 percent, 4.9 percent, 1.9 percent and 1.5 percent against the US Dollar, Pound Sterling, Euro and CFA Franc respectively," he said.

Governor Saho was however quick to add that the Dalasi depreciated slightly against all major currencies between June and July 2008.

"The banking system recorded significant asset and deposit growth as well as a strong capital base. Total assets of the banking industry increased to D11.3 billion or 12.2 percent from end-June 2007. Return on assets declined from 2.1 percent in March 2008 to 1.5 percent at end-June," he revealed.