Georgetown Businesses support introduction of $5000 note, foresee no inflation

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[www.inewsguyana.com] – Businesses in Georgetown have come out in full support of the introduction of the $5000 monetary note according to a statement issued by the Georgetown Chambers of Commerce and industry (GCCI).

The Chamber said it does not envisage inflationary pressures or increases as a result of the introduction of the new denomination; basing its argument primarily on the position articulated by Central Bank Governor Lawrence Williams at a Banking Seminar organized by the Chamber in 2012.

GCCI said Williams assured that the new note is not intended to increase Guyana’s money supply but rather shift the dependency from the $1,000 note to the new, larger $5000 denomination.

“He informed us that international standards and principles usually dictate that the highest currency denomination usually account for around 20 per cent of total currency notes or 60 per cent of the total value of money in circulation.”

In Guyana’s case, the $1000 note at the time accounted for 59 per cent of the quantity of currency notes in circulation and around 94 per cent of the total value of money in circulation.

“The only inconvenience envisaged is the use of the $5000 notes to carry out small transactions that would require vendors offering a good or service to provide many smaller notes in return as “change” the body notes while suggesting that “the Central Bank issue an advisory, if permitted by law, on a minimum amount during a transaction where a $5000 note can be tendered. If the law does not provide, a legislative amendment should be made.”

The GCCI added that despite efforts at encouraging the use of electronic instruments to facilitate economic transactions, there is still a dominant predilection by the populace to use cash as a convenient and efficient means of settling transactions.

“The $5000 note reduces the amount of notes required to carry out transactions and this is particularly welcomed for those individuals and companies that are engaged in large financial exchanges” the statement noted.

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