BOL, commercial banks to establish centralised foreign exchange platform 
 
The Bank of the Lao PDR (BOL) and commercial banks plan to jointly set up an integrated and centralised foreign currency exchange system that can be used by people from all walks of life.
A Memorandum of Understanding (MOU) on the creation of the system was signed on Monday, with 15 commercial banks in Laos showing interest in investing in and setting up a centralised foreign exchange market.

Acting Governor of the Bank of the Lao PDR (BOL), Mrs Vatthana Dalaloy, along with the bank’s Board of Governors, director generals of related departments of the BOL, the BOL Head of Office, and the directors of 15 commercial banks attended the MOU signing ceremony.
Prior to the signing ceremony, Director General of the BOL Monetary Policy Department, Mr Soulisack Thamnouvong, briefed the gathering about the aims of and background to the development of the centralised exchange market system.
He said the objective of the currency exchange system was to minimise the imbalance between the demand and supply of foreign currency, especially the demand for foreign currency to pay for imported goods and services and to pay debts owed to other countries.
“While the exchange rate and the level of inflation remain high, this inevitably affects everyone’s lives, while currency exchange in the off-system market makes it difficult to monitor and collect transaction data outside the banking system, which hinders the implementation of BOL’s policies,” Mr Soulisack said.

“To maintain the stability of the kip and regulate exchange rates, BOL plans to introduce a centralised foreign exchange market as a centralised foreign currency exchange platform that will enable individuals and entities to trade in foreign currencies in ways that are more convenient while also being auditable,” he added.
“During the trial period of the scheme, our association will work in collaboration with various BOL departments to formulate plans to build the capacity of staff at the commercial banks involved in the project,” the President of the Lao Bank Association, Mr Phoutthaxay Sivilay, said.
Following the signing ceremony, Director General of the BOL’s Monetary Policy Department, Mr Soulisack Thamnouvong, and the Managing Director of BCEL Mrs Saysamone Chanthachack held a media briefing to clarify the aims of the centralised foreign exchange market.
The ultimate aim of the scheme is to encourage members of the public to change foreign currencies at banks. The centralised foreign exchange market will be a convenient platform for the purchase and sale of currencies by individuals and businesses.
Mrs Saysamone said commercial banks will continue to work with the central bank to ensure the project is smoothly implemented and benefits the people of Laos while also stabilising the economy.
“Every bank that has signed the MOU today is now eligible to become a shareholder in establishing a legal entity and to create the conceptual framework, establishment criteria and market transaction model so that the system can soon become operational,” she added.

By Advertorial Desk
 (Latest Update August 9, 2024)