Traders have raised concern over scarcity of US Dollars in the market due to the recent depreciation of the Rwandan franc.

The dollar scarcity and depreciation have exposed importers of a wide range of goods to losses, since many work on tender contracts they have to service, which are locked on a lower dollar rate.

“The US dollar scarcity is getting out of hand, and it is very expensive because of these factors which are incurring untold losses, banks can’t also give us the dollars we need and at the time we need them,” said Kamali Sylvester, an importer.

He told Rwanda Today that although the franc has been on this depreciation trajectory since last year, the scarcity and cost of the dollar in the market worsened in the last six months until now when things got really bad.

“The more it takes me longer to get the dollars I need, the more goods will delay, and by the time these goods come they are very expensive” “For most of the tenders we signed, one dollar was at Rwf900, now one dollar is at Rwf1,100 yet the contracts can’t be re-adjusted, many of us are in losses,” he said.

Tourism has been one of Rwanda’s key sources of foreign exchange earnings but as tourists stayed away and exports waned due to the pandemic, the market has suffered a serious dollar shortage.

In March, franc traded between Rwf977 and Rwf994, against the dollar, however by June 30th, it traded Rwf996 against the dollar, and now it has crossed the Rwf1000 threshold to trade at Rwf1100 for 1 US dollar.

Every Tuesday of the week, the National Bank of Rwanda injects up to $2 million into the forex market, but Gasana Vianney, vice president of the forex traders’ association says much as this has been helpful, it is now having little impact, and that traders would appreciate this figure to be increased if there is a way.

The boom in construction last year and this year has also led to a further reduction in dollars as traders used a lot of dollars to import materials such as cement and iron bars.