7 January 2016

Namibia: No Plans to Ban Kwanza Conversion - BoN

THE Bank of Namibia says there are no plans by the central banks of Angola and Namibia to terminate the currency conversion agreement between the two countries.

This comes after northern business people reported a drop in business at Oshikango because clients cannot exchange the Namibia dollar and the kwanza at the northern border town.

They expressed fears that the currency conversion, which was suspended at Oshikango, might also be terminated at Santa Clara where it is operating under strict conditions.

Responding to questions by The Namibian yesterday, Bank of Namibia's acting director of communications and financial sector development Emma Haiyambo said the two central banks do not plan to terminate the agreement.

"The two central banks do not plan to terminate the agreement as this arrangement remains beneficial for trade promotion and facilitation between the two countries," she said.

When The Namibian visited the Angolan border town of Santa Clara on 24 December 2015, there were no kwanza conversion activities taking place at the banks of that town and many business people at both towns confirmed that no conversion had taken place since 21 December 2015, Haiyambo said the Banco Nacional de Angola implemented the second option of the agreement on 21 December 2015 as per the currency conversion agreement.

"The Bank of Namibia will keep the media informed of any developments pertaining to this agreement as and when the need arises," said Haiyambo.

On Tuesday, business people at Oshikango told The Namibian that the limited amount that the Angolan commercial banks allow for exchange was not enough to boost the economy and believe it defies the purpose for which the currency conversions were introduced.

They have urged the central bank to bring back the currency conversion to Oshikango.

The commercial banks and bureaux de change at the border town of Oshikango set the limit of exchange at 30 000 kwanza per person as of Tuesday when they resumed currency conversions.

"Bank of Namibia can work on structures similar to those implemented by Banco Nacional de Angola, such as a reduced amount of exchange per person, but still feasible to stimulate trade and with attractive exchange rates to attract Angolans to make use of the facility," said Eli Ilonga, an executive member of the Oshikango Business Association on Tuesday.


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