At the post-Cab­i­net news con­fer­ence on May 15, Prime Min­is­ter Kam­la Per­sad-Bisses­sar an­nounced that three of her min­is­ters—Min­is­ter of Fi­nance, Dav­en­dra­dath Tan­coo, Min­is­ter of Plan­ning, Eco­nom­ic Af­fairs and De­vel­op­ment, Kennedy Swarats­ingh and Min­is­ter of Trade, In­vest­ment, and Tourism, Satyaka­ma “Ka­ma” Ma­haraj—were man­dat­ed to pro­duce a re­port on for­eign ex­change dis­tri­b­u­tion and leak­age over the past ten years.

The Prime Min­is­ter em­pha­sised that she ex­pect­ed the re­port to fo­cus on the for­mal dis­tri­b­u­tion sys­tem of for­eign ex­change, but al­so on the “leak­age” of for­eign ex­change from the for­mal dis­tri­b­u­tion sys­tem, which she de­scribed as “a se­ri­ous mat­ter.”

She said one of the cries the cur­rent ad­min­is­tra­tion has heard is on the is­sue of for­eign ex­change avail­abil­i­ty. As a re­sult, said Mrs Per­sad-Bisses­sar, the Gov­ern­ment needs to know where the for­eign ex­change went, who re­ceived the for­eign ex­change, why they re­ceived it, the process used to de­ter­mine who re­ceived for­eign ex­change, and how that for­eign ex­change was used or de­ployed.

She said the for­eign ex­change dis­tri­b­u­tion and leak­age re­port will be brought to the Cab­i­net and the re­port will be shared with the pub­lic.

“Then this re­port, as I say, will be made pub­lic to iden­ti­fy the main users, the main fa­cil­i­ta­tors of this un­fair dis­tri­b­u­tion, and ex­plain to the pub­lic how this en­tire for­eign ex­change dis­tri­b­u­tion car­tel and con­spir­a­cy be­tween cer­tain op­er­a­tives and busi­ness­es was func­tion­ing.

“I want you all to un­der­stand that every­thing will be all right. With re­gard to our coun­try’s fi­nances, I give you an as­sur­ance against we will fix it. We will do every­thing hu­mane­ly pos­si­ble to fix it,” said the T&T Prime Min­is­ter.

Ex­pos­ing main forex users?

It seems to me that what Mrs Per­sad-Bisses­sar is in­ter­est­ed in is a re­port sim­i­lar to the one de­liv­ered by for­mer Cen­tral Bank Gov­er­nor, Jwala Ram­bar­ran on De­cem­ber 4, 2015, at the Cen­tral Bank’s fifth bi-an­nu­al Mon­e­tary Pol­i­cy Fo­rum. Dur­ing that meet­ing, Mr Ram­bar­ran named the top five users of for­eign ex­change by sec­tor and the amount they had used for the pre­vi­ous three years.

As is well known, on De­cem­ber 24, 2015, at around 6:30pm, Mr Ram­bar­ran re­ceived a doc­u­ment re­vok­ing his ap­point­ment as Gov­er­nor.

That in­stru­ment of re­vo­ca­tion was is­sued by the then act­ing Pres­i­dent, Chris­tine Car­la Kan­ga­loo, but did not con­tain any rea­sons or grounds which would ex­plain to the Mr Ram­bar­ran the ba­sis on which his ap­point­ment had been re­voked, ac­cord­ing to the June 2022 judg­ment de­liv­ered by High Court Jus­tice Devin­dra Ram­per­sad.

Be­fore the high court, Mr Ram­bar­ran’s at­tor­neys ar­gued the Min­istry of Fi­nance failed to pro­vide him with suf­fi­cient par­tic­u­lars of the mat­ters al­leged against him that were tak­en in­to ac­count in the de­ci­sion to ter­mi­nate his ap­point­ment. The at­tor­neys al­so ar­gued that Mr Ram­bar­ran was not giv­en an op­por­tu­ni­ty to be heard in de­fence of the dis­clo­sures he made.

Mr Ram­bar­ran was suc­cess­ful be­fore the High Court and the judg­ment by Jus­tice Ram­per­sad was up­held by a three-mem­ber pan­el of the Court of Ap­peal on Feb­ru­ary 11, 2025, with Jus­tice of Ap­peal, Nolan Bereaux, is­su­ing the judg­ment.

I have not read all of the judg­ments at the High Court and the Court of Ap­peal on this mat­ter, but I won­der if the lo­cal ju­di­cia­ry paid suf­fi­cient at­ten­tion to the Cen­tral Bank Act and the Fi­nan­cial In­sti­tu­tions Act, which pro­vide for se­cre­cy and con­fi­den­tial­i­ty, re­spec­tive­ly.

At sec­tion 56 (1), the Cen­tral Bank Act states: “Ex­cept in so far as may be nec­es­sary for the due per­for­mance of its ob­jects, and sub­ject to sec­tion 8 of the Fi­nan­cial In­sti­tu­tions Act, every di­rec­tor, of­fi­cer and em­ploy­ee of the Bank shall pre­serve and aid in pre­serv­ing se­cre­cy with re­gard to all mat­ters re­lat­ing to the af­fairs of the Bank, any fi­nan­cial in­sti­tu­tion or per­son reg­is­tered un­der the In­sur­ance Act or of any cus­tomers there­of that may come to his knowl­edge in the course of his du­ties.”

Sec­tion 8 (1) of the Fi­nan­cial In­sti­tu­tions Act, un­der the rubric ‘pro­hi­bi­tion against dis­clo­sure,’ states: “No di­rec­tor, of­fi­cer or em­ploy­ee of the Cen­tral Bank or per­son act­ing un­der the di­rec­tion of the Cen­tral Bank shall dis­close any in­for­ma­tion re­gard­ing the busi­ness or af­fairs of a li­censee or any of its af­fil­i­ates or in­for­ma­tion re­gard­ing a de­pos­i­tor, cus­tomer or oth­er per­son deal­ing with a li­censee, that is ob­tained in the course of of­fi­cial du­ties.”

Sec­tion 8 (2) of the Fi­nan­cial In­sti­tu­tions Act states that notwith­stand­ing sub­sec­tion (1) or any oth­er writ­ten law, the Cen­tral Bank, or a per­son au­tho­rised in writ­ing by the

Cen­tral Bank, may dis­close the in­for­ma­tion re­ferred to in sub­sec­tion (1) to: any lo­cal or for­eign reg­u­la­to­ry agency or body that reg­u­lates fi­nan­cial en­ti­ties; for pur­pos­es

re­lat­ed to that reg­u­la­tion; the De­posit In­sur­ance Cor­po­ra­tion for pur­pos­es re­lat­ed to its op­er­a­tions; or the des­ig­nat­ed au­thor­i­ty un­der the Pro­ceeds of Crime Act, “if the Cen­tral Bank is sat­is­fied that the in­for­ma­tion will be treat­ed as con­fi­den­tial by the agency or body to whom it is dis­closed and used strict­ly for the pur­pose for which it is dis­closed.”

In short, I am sure that the laws of T&T do not al­low the Cen­tral Bank to dis­close the names of the top users of for­eign ex­change in T&T. And I am not con­vinced that the phrase “ex­cept in so far as may be nec­es­sary for the due per­for­mance of its ob­jects,” in the Fi­nan­cial In­sti­tu­tions Act, pro­vides a loop­hole to al­low the dis­clo­sures that were made in De­cem­ber 2015.

I am yet to find a prece­dent, around the world and in the his­to­ry of bank­ing, for the dis­clo­sure of pri­vate bank­ing in­for­ma­tion by the head of a Cen­tral Bank at a pub­lic fo­rum. If this mat­ter is ap­pealed to T&T’s apex court, which is the Ju­di­cial Com­mit­tee of the Privy Coun­cil, I am san­guine that that body will con­cur with the no­tion that the code of se­cre­cy among cen­tral bankers pre­vents the iden­ti­fi­ca­tion of spe­cif­ic com­pa­nies, on grounds that in­clude the pub­lic has a right to know who is get­ting ac­cess to the lim­it­ed sup­ply of for­eign ex­change.

I would be very sur­prised if the cur­rent Cen­tral Bank Gov­er­nor, Dr Alvin Hi­laire, ac­qui­esces to any re­quest, or de­mand, by Min­is­ter of Fi­nance, Dav­en­dra­dath Tan­coo, for in­for­ma­tion on the com­pa­nies that are the largest users of for­eign ex­change at this time.

I trust that the most the Cen­tral Bank would be pre­pared to share would be cat­e­gories of for­eign ex­change users—such as food im­ports, phar­ma­ceu­ti­cal im­ports, new and for­eign-used cars, pay­ment for fu­el im­ports, and the sat­is­fac­tion of US-dol­lar cred­it card bills—which the Cen­tral Bank al­ready pro­vides in its var­i­ous pub­li­ca­tions.

Struc­ture of forex mar­ket

In my view, the fun­da­men­tal prob­lem with T&T’s for­eign ex­change mar­ket is not dis­tri­b­u­tion or leak­age, but the fact that de­mand for for­eign ex­change has out­stripped the sup­ply of it, at the de fac­to top rate of US$1 to TT$6.79, on a con­sis­tent ba­sis for at least the last 12 years.

This is borne out by the Cen­tral Bank’s An­nu­al Eco­nom­ic Sur­vey 2024, which states that the sup­ply of for­eign ex­change by au­tho­rised deal­ers to the mar­ket last year amount­ed to US$4.54 bil­lion. The de­mand for for­eign ex­change by au­tho­rised deal­ers to the pub­lic reached US$5.89 bil­lion in 2024, a de­crease of 5.3 per cent rel­a­tive to the pre­vi­ous year.

Ac­cord­ing to the sur­vey, “The net sales gap reached US$1.35 bil­lion dur­ing the pe­ri­od. To sup­port the mar­ket, the Cen­tral Bank sold US$1.36 bil­lion to au­tho­rised deal­ers.” Part of the Cen­tral Bank’s sale of the US$1.36 bil­lion to au­tho­rised deal­ers came from the draw down of T&T’s net of­fi­cial for­eign re­serves and the Her­itage and Sta­bil­i­sa­tion Fund as well as from bor­row­ing US dol­lars on the in­ter­na­tion­al cap­i­tal mar­ket.

That means T&T is de­plet­ing its re­serves and sav­ings and bor­row­ing US dol­lars in or­der to fund the coun­try’s seem­ing­ly in­sa­tiable ap­petite for for­eign goods and ser­vices.

That is be­ing done by way of an ex­change rate that the In­ter­na­tion­al Mon­e­tary Fund con­sid­ers to be sta­bilised and for which, ac­cord­ing to the IMF, T&T main­tains an ex­change re­stric­tion sub­ject to the Fund’s ap­proval un­der Ar­ti­cle VI­II sec­tion 2 (a).

“The ex­change re­stric­tion aris­es from the au­thor­i­ties’ re­stric­tion of the ex­change rate (ie, by re­strict­ing the max­i­mum mar­ket buy and sell rates, and pro­hibit­ing for­eign

ex­change trans­ac­tions be­yond the max­i­mum rates), while not pro­vid­ing enough for­eign ex­change— ie through the Cen­tral Bank’s for­eign ex­change in­ter­ven­tions—to meet all de­mand for cur­rent trans­ac­tions at that rate,” ac­cord­ing to the IMF 2024 Ar­ti­cle IV con­sul­ta­tion re­port on T&T.

In short, the IMF is ar­gu­ing that the ex­change rate used must al­low all de­mand for cur­rent trans­ac­tions to be met. I cer­tain­ly con­cur with that ad­vice.