Fimda urges RBM to close loopholes in forex market
Financial Market Dealers Association of Malawi (Fimda) has urged the Reserve Bank of Malawi (RBM) to close gaps in the foreign exchange market to ensure that the little forex the country generates finds its way in the formal foreign exchange market.
The call by Fimda follows a Reserve Bank of Malawi (RBM) notice suspending the sale of cash export proceeds to foreign exchange bureaux, effectively barring people who get foreign currency directly from exporters from exchanging it with kwachas in the bureaux.
In a written response yesterday, Fimda president Leslie Fatch said the central bank needs to guard the forex market and promote accountability in the collection of forex.
“Such a decision helps to close some of the loopholes on the repatriation of export proceeds which will now be channelled through wire transfers, thereby ensuring the country receives proceeds from export of goods and services,” he said.
RBM re-introduced the customs declaration forms for declaration of exports to monitor forex flows on May 17 this year to ensure that all export earnings are repatriated into Malawi.
But in a statement yesterday, RBM said it noted that there is continued proliferation of unauthentic foreign exchange bureau receipts.
Reads the statement: “The bank, therefore, wishes to advise exporters who receive export proceeds in foreign currency cash to either deposit the funds in their foreign currency denominated accounts or exchange the same with commercial banks.”
The statement further indicates that effective October 1 2023, Society for Worldwide Interbank Financial Telecommunications (Swift) statements, bank statements and bank deposit slips shall be the only acceptable documents for reconciliation of export declarations made under the electronic CD1 form.
RBM spokesperson Mark Lungu said yesterday some bureau receipts, which were being presented as evidence of declaration of export proceeds, were fake.
“This means that export proceeds were not finding their way into the formal market, thereby contributing to shortage of foreign exchange on the market,” he said.
