Tanzania’s central bank, the Bank of Tanzania (BoT), has issued a warning against the dollarisation of the local market in an effort to alleviate pressure on the country’s currency.
Businesses have been instructed to cease pricing goods and services in American dollars as they are violating regulatory directives. The governor of the central bank, Emmanuel Tutuba, emphasized that the Tanzanian shilling remains the only legal tender within the country.
The government initially prohibited the use of the US dollar in August 2007, followed by another ban in December 2017. The central bank emphasized that these directives remain in effect and must be adhered to.
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A notice dated June 20 reiterated the government’s position, stating that tourists and non-residents who choose to pay in foreign currencies must provide identification documents such as passports and certificates of incorporation for proper statistical recording and classification.
There has been a surge in demand for foreign exchange in recent months, particularly in sectors such as real estate, health, transport, and education. Businesses are seeking to protect themselves against the depreciation of the local currency.
Governor Tutuba also issued a warning regarding the existence of parallel foreign exchange markets, commonly known as the black market. He emphasized that commercial banks and bureaux de change are the only registered institutions authorized to determine exchange rates.
The central bank’s move aims to maintain stability and control within Tanzania’s local market, reinforcing the country’s commitment to its national currency.
