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The outflow of dollars has left the country running at a roughly 7-10% deficit of the currency to requirements, Karabayeva said.
While the lack of dollars may be causing headaches for people who need them to conduct business transactions, at least one set of businesses is profiting. Namely, banks and exchange offices doing the currency trades. Some are wondering if speculators might not just be shipping their dollars out of the country in bulk for a quick buck.
The Kyrgyz som is particularly strong at the moment – around 83 to the dollar, higher than it was before and around the start of the Ukraine war. In mid-March, the som was trading at more than 100 to the dollar.
The National Bank’s explanation for this is that the rate is reliant to a strong extent on the volume of cash in circulation. With a limited amount of hard currency banknotes to be had, people are simply keeping their money in their bank accounts.
This is not to say people are not trying to cash out into dollars, which retain strong appeal. Many make daily trips to the bank to withdraw whatever they can.
Erika Isayeva, a 24-year-old Bishkek resident, says she regularly calls banks in advance to check whether they have stocked their ATMs with dollars. At times, she has to zig-zag around the city to get banknotes.
“One time I wanted to withdraw dollars and I asked at which ATM I could get them. They told me that they only had them at the Avangard business centre. By the time I got there, within 40 minutes, they [the dollars] were already gone,” Isayeva said.
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The hard currency shortage has been looming for some time. In April, the banking regulator mandated that cash transfers to Kyrgyzstan be received or cashed out in som. Anybody wishing to hold foreign currency, even if only in virtual form on foreign money-denominated accounts, have since that time had to perform an exchange operation.
That has been a boon for banks. According to figures collated by 24.kg news agency, domestic banks performed 10.8bn som ($130mn) worth of currency exchanges in the period from January to June this year. That is seven times more than in the same period in 2021.
Economist Marat Musuraliyev told Eurasianet that this demand for currency exchange is generating record profits for local banks.
“Bank revenues have increased, but interest rates on loans and deposits have not changed radically,” Musuraliyev said.
Musuraliyev said he believes banks will probably up the size of commissions for cashing out dollars due to the difficulty they are experiencing getting hold of the currency.
One measure for easing the problem, said Musuraliyev, would be to restrict the amount of dollars that can be taken abroad
– as Kazakhstan did in March. The downside of that solution would be that it would increase the likelihood of corruption at customs control points, he said.
Ayzirek Imanaliyeva is a journalist based in Bishkek. This article originally appeared on Eurasianet.org.
TikTok trending Albania heads for record summer tourist season
Clare Nuttall in Saranda
On City Beach in Saranda it’s hard to find a space to lay down a towel among all the others on the stony beach, whose owners are either stretched out soaking up
the sun or bobbing about in the clear sea water. Alongside local people who head down to the beach for a quick swim after work, are many tourists from nearby Greece, Albania’s former Yugoslav neighbours and, these days, from other parts of Europe.
Long a popular destination among East European seeking
a cheap beach holiday, Albania is increasingly on the radar of
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travellers from further afield. With holidaymakers squeezed like everyone else by inflation and the rising cost of living across Europe, its reputation as a budget destination has become a major selling point.
Social media video site TikTok has recently been flooded by videos extolling the benefits of Albania as a holiday destination – with a focus on its beaches, cheap but stylish bars and Unesco heritage sites, a trend first picked up on by The Times. One tour guide’s video of Ksamil, a popular seaside village close
to Saranda, has received over 60mn views on TikTok.