That is an excellent question, and it is also a great article that Humberto Vacaflor just wrote, published in El Deber’s website:
The Central Bolivia Bank (BCB) announced a reserve requirement for deposits in foreign currency of a 66.5% level, that will now be achieved with monthly increases of 0.8%.
The news comes a few days after the debate that occurred, although no effects on the reform act for the BCB, by which the autonomy that has the issuing body will be reduced drastically.
The measure over the reserve requirement of the deposits in dollars had leaked and it was labelled as ‘semi-dedollarization’, because it would put half of the savings of the people in that currency in the hands of the Government.
The idea of the Government is to discourage the use of the US dollar in the financial system. Rafael Correa, PhD in economy and President of Ecuador, thinks the opposite way and apparently believes that the important thing is to encourage savings and production, without looking what color are the pieces of paper.
If it is to be a de-dollarization or not, the facts will tell. No rule to occur, as in other cases that occur nearly every day, the Government could also give a step backwards on this issue.
For the time being, the feeling is that the Government is very urged for money. It has become used to a rate of waste so great that now, when public debt has skyrocketed ($8,500 billion), mining exports have fallen 33% and Venezuela money access is dubious, looking for new resources even with unorthodox measures [seems the only possible way out].
And it is an Assembly of the Organization of American States (OAS) that will cost the country $ 17 million, invoices of sugar mills ordered urgent but with no studies or bids places, other invoices with ‘nationalizing’ enthusiasm of the early years of the Government…
Meanwhile, it is still unnerving among collaborators of the Government, the announcements made by the President, when he’s going to jail for the errors committed in his Government, he will bring them as the real culprits.
Fully control of the audiovisual media, as in the present case, seems that it doesn’t serve that much.
Humberto Vacaflor writes wonderfully and my hope is that current government comes to its senses, abandons political ill practices and governs for our benefit.