US Federal Reserve is safest place to save Guyana’s income from oil -Central Bank Governor
The decision to place Guyana’s revenue from oil in the United States Federal Reserve Bank has been defended by the Finance Minister.
Finance Minister Winston Jordan supported by the Central Bank Governor Dr. Gobin Ganga both agreed that placing the finances from the Natural Resources Fund (NRF) in US reserve is the best move.
Their statements yesterday came on the heels of criticisms over the move.
Dr. Ganga told reporters that the Federal Reserve System – the central banking system of the US is by far the safest institution to hold Guyana’s petroleum revenues.
The governor noted that foreign assets belonging to Guyana have been kept at the Federal Reserve for close to 50 years, and it is in safe hands when the other available options are considered.
“Let me tell you, you want to put your money at one of the safest institutions. There are many of them, but the Fed is one of them. The Fed was approached long back. You just don’t go and talk to them. You have to engage them. We have been talking for months,” Dr. Ganga explained.
On the other hand, Minister Jordan noted that Guyana could make an average of three percent interest on its investment, but the ultimate aim is to meet an average of 32 percent long-term (interest).
“After investing in all these different assets, the aim over time is 3 percent. So sometimes you may get 1.5 percent, sometimes you might be lucky to get 4 and a half per cent. Sometimes we might get 3.2, 2.8 percent. And long term 3 percent…because the safer the asset, the lower the interest”.
According to Jordan, Guyana could not earn any interest if the money was saved locally.
