What you need to know about latest Reserve Bank of Zimbabwe directive on use of free funds

Salaries for NGO and embassy staff:

Salaries for staff working for embassies, international organisations and NGOs shall continue to be transferable into their individual FCAs, “at the discretion of the NGO or embassy”.

When the employees of the said embassies, international organisations and NGOs want to transact domestically, they will have to convert their cash into Zimbabwe dollars through banks and bureaux de change at the market rate.

Expatriates and diplomats are allowed to remit funds to their home countries.

Visa fees charged by embassies:

Embassies are allowed to continue charging visa processing fees in foreign currency. These fees are freely remittable to their home countries.

Buying forex for tuition, medical, subscriptions and airfares from bureaux de change:

With effect from July 24, bureaux de change allowed to sell forex for foreign tuition, medical services, subscriptions and air tickets to individuals on a willing seller-willing buyer basis, subject to documentary proof backing the transactions.

Bureaux de change may sell up to US$500 to individuals and micro, small to medium enterprises with no questions asked. They may also sell up to US$2 000 to individuals and traders who intend to import goods and services, subject to rules governing imports.

Business and holiday travel:

Bureaux de change may also sell forex to individuals for business and leisure travel.

For business travel, the limit is US$400 per day for up to 7 days. Holiday travellers can buy the equivalent of US$300 per day for a maximum of 7 days, capped at US$10 000 per year.

Blocked funds:

These are foreign currency payments due to foreign suppliers and entities which were not paid due to the shortage of forex. The backlog goes back to January 2016 and the RBZ is compiling a register of all blocked funds. Only foreign liabilities accrued between January 2016 and 21 February 2019 will be considered for this purpose.

Registration started in February 2019 and will end on August 30, 2019.

These foreign liabilities, initially estimated at US$1.2 billion, will now be assumed by the RBZ.

However, after concerns over what would be a blanket assumption of foreign liabilities, the RBZ has now tightened conditions for the debt takeover with the following restrictions:

1-Only non-exporting companies, institutions and individuals are eligible for this arrangement. Exporters, government, parastatals and other public institutions are excluded.

2-Proceeds of disinvestment from the Zimbabwe Stock Exchange are also excluded, since remittances are allocated 15% of available forex on the inter-bank market, in terms of the central bank’s guidelines. –NewZwire

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