Monetary Policy Committee (MPC) of the Central Bank of the Gambia met on
Thursday to assess recent economic developments and set the key policy rate.
Following the summaries of the deliberations on key economic indicators that informed the decision of the committee, the governor of the Central Bank Bakary K. Jammeh dealt on the global economic development that growth remains subdued amid heightened policy uncertainty that continues to dent business confidence, investment and trade.
On domestic economic outlook on the real sector, he said the Gambian economy remains strong and the prospects are favourable, saying “the Central Bank’s Composite Index of Economic Activity (CIEA) suggests that economic activity remained robust in the first half of 2019 and points to stronger growth in the second half of the year. According to the Gambia Bureau of Statistics (GBoS), real progress domestic product growth stood at 6.5% in 2018 compared to 4.8% in 2017, driven mainly by the services sector including tourism and trade, financial services and insurance, transport and telecommunication.”
On external sector development, he continued that preliminary balance of payments estimates indicate that the current account deficit narrowed to US$25.8 million (1.5% of GDP) in the first half of 2019 compared to a deficit of US$26.7 million (1.7% of GDP) in the corresponding quarter in 2018.
“The improvement in the current account balance is attributed in the increase in the foreign inflows related to the support from development partners, Diaspora remittances and tourism. The deficit in the goods account, widened to US$194.6 million (11.0% of GDP) in the first six months of 2019 compared to US$150.0 million (9.3% of GDP) in the corresponding period of 2018. Import rose to US$277.7 million or by 29.8% in the first half of 2019 from US214.0 million in the same period in 2018. Exports also increased by 35.6% to US$74.4 million during the period under review.”
He, however, divulged that the services account balance, on the other hand, registered a surplus of US$59.7 million in the first six months of 2019, higher than a surplus of US$40.5 million a year ago, explained largely by the increase in tourist arrivals.He added that gross international reserves are projected at four months of next year’s imports of goods and services.