The Monetary Policy and Regulation Board and the CBE indicated in a statement that the funds are used to fulfill payments abroad and meet the demand for banknotes and coins in the national financial system.

The statement indicates that as in 2009, 2015, 2017, 2018 and 2020, reserves were reduced by more than two billion in eight months mainly due to the fact that the obligations of the public sector abroad have been greater than foreign exchange income.

According to the statement, the operations resulted in a negative net flow of $1,904 billion between January and August 2023.

The CBE indicated that these obligations mainly correspond to payments of external debt contracted by previous administrations and that, unlike in past periods, the amount allows timely compliance with “cross-border payments” and the “provision of working capital at a national level”, guaranteeing the sustainability of the dollarization in the country.

International reserves currently cover 100 percent of the national fractional currency in circulation, and the resources of financial entities, public and private, and the popular and solidarity economy deposited in the Central Bank, the institution said.

The CBE published the statement after experts and the media denounced that the reduction of resources in reserve ended up in the hands of private banks.

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