Reserve Bank sets forex payment priority list

By Oliver Kazunga

The Reserve Bank of Zimbabwe (RBZ) has directed authorised dealers and bureaux de change to immediately prioritise 70 percent of their foreign currency payments to the productive and essential goods and services sector.

In a circular issued on Wednesday, the apex bank said the directive was meant to ensure that the economy responds to the enhancement of production in the country in light of the Covid-19 impact.

“Accordingly, and consistent with the exchange control circular number 3 of 2020, authorised dealers and bureaux de change are advised that the attached priority list for foreign currency payments shall apply with immediate effect to ensure that foreign currency resources are substantially channelled to the productive sectors of the economy in light of the Covid-19 pandemic,” said RBZ.

It said 70 percent of the foreign currency payments should be prioritised to the productive sector for the importation of raw materials, machinery and spare parts for local production (value addition) that directly substitute import of essential finished products. Among others, 70 percent of the foreign currency payments should be prioritised on imports of critical and strategic goods such as basic foodstuffs and fuel, health and agro-chemicals provided the foods are not available locally.

Top priority should also be accorded to the importation of packaging material, mining consumables, goods and services not locally available for tourism operators, medical consumables and fees, payment for services not available in Zimbabwe, remittance of pension income for non-resident Zimbabweans who formally migrated from Zimbabwe, as well as payment for university and college fees.

The monetary authority also indicated that the other 30 percent of foreign currency payments should be prioritised on capital remittances for cross border investments, capital remittances from disposal of local property, disinvestment proceeds and dividend remittances as well as funding of off shore credit cards. The Chronicle