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The Private Sector Development Association (PSDA) has expressed optimism that the Bank of Zambia’s upward revision of the foreign exchange negotiable threshold will significantly boost industries such as mining and manufacturing.
PSDA Chairperson, Yusuf Dodia, said the adjustment, which raises the negotiable threshold for overseas transactionsfrom US$1 million to US$5 million, would enhance investment in capital-intensive sectors over the next 12 to 24 months.
The central bank announced the changes this month under the Foreign Exchange Market Guidelines and Interbank Foreign Exchange Market (IFEM) Rules, aiming to improve operational efficiency in the domestic forex market.
In a telephone interview with Zambia Monitor, Dodia stated that the revision would ease transactions for sectors requiring high-value equipment, particularly mining and energy.
Read more: Bank of Zambia raises foreign exchange negotiable threshold for foreign transactions to $5 million
“The real beneficiaries of this change are industries involved in large-scale industrial development. Mining and energy sector equipment, such as turbines and hydroelectric generators, is very expensive.
“It is crucial that businesses in these sectors can now transact in larger figures of up to US$5 million. We hope this move will significantly boost mining sector investments over the next 12 to 24 months,” he said.
Dodia explained that the revised threshold would enable companies to import equipment worth up to US$5 million using letters of credit, simplifying transactions that previously had to be split into smaller amounts due to the lower US$1 million limit.
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