Regulatory Alerts2001-01-01
Bank of Zambia Circular 08/2001: New Measures on Foreign Exchange Transactions
The Bank of Zambia has issued new regulatory measures to stabilize the Kwacha and curb foreign exchange market abuses by requiring exporters to deposit at least 75% of proceeds locally within 180 days and channeling all external payments over US $5,000 through commercial banks. Authorized foreign exchange dealers are restricted to a maximum 2% margin between buying and selling rates, while commercial banks must reduce their foreign exchange open positions to 15% of paid-up capital and limit demand deposits to 25% of total holdings. Additionally, all domestic transactions must be settled in Kwacha, bureaux de change face stricter capital and licensing requirements, and non-compliance will result in significant financial penalties.
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