Turkmenistan to introduce 100 percent mandatory forex sales

Turkmenistan will force local companies to sell all of their export proceeds to the country's sovereign fund, up from the previously required 50%, state television reported on Monday.

The further tightening of foreign exchange controls could indicate a worsening of hard-currency shortages in the tightly controlled and isolated country, whose main source of income is gas exports to China.

President Kurbanguly Bedymukhamedov, according to the state television report, called the controls a temporary measure and also ordered his cabinet to review the state budget.

The mandatory foreign currency sales are made at the official rate of 3.5 manats per dollar. On the black market, the dollar changes hands for 21 or 22 manats.

PetroChina, the main buyer of Turkmen gas, suspended some purchases in March.