5% Copper export increase while Kwacha depreciates – a reflection of failure to actualize export tracking framework – Expert
Economist Yusuf Dodia says the latest Zamstatics report showing an increase of about 5 percent of copper export earnings is a clear reflection of Governments failure to actualize the export proceeds tracking framework.
The BOZ export tracking framework which came into effect on 1st January, 2024 requires that all exporters in Zambia open bank accounts with a bank or financial institution domiciled in Zambia and deposit all export proceeds to that account within a period of 90 days.
Speaking an in an exclusive interview with the Zambian Business Times (ZBT), Dodia said the country is being deprived of benefits from copper because if the Export Tracking Framework was properly implemented, the country would been realizing about $20 – 30 million dollars a day.
He said the purported increase of copper production would also be meaningless as long as the economy is not benefiting from the higher exports and remitting back of proceed to Zambia.
“This report is showing us our losses, currently the only thing the country is benefiting is mineral loyalty Taxes which is very small, the developments in the mining industry will remain unimpactful as long those export earnings are not coming to Zambia, we are just running an economy for the benefit of western investors,” he said.
He said the lack of actualizing the Export Tracking Framework has spilled over to the instability of the Kwacha and economy at large.
Dodia revealed that whilst 20 to 30 million dollars of copper leave the country everyday, there is no formidable steps being taken to harness the potential of the minerals.
“We are losing 20 to 30 million dollars, the increase in production maybe is 25 million dollars a day, it is just showing us that we need to improve or atleast the Bank of Zambia and Government must take steps to safeguard the economy,” He said.
The BOZ export proceeds tracking framework directive had brought renewed hope, with analysts and economists projecting that, if well implemented, the Kwacha may post further gains as this balance of payments monitoring tool is expected to bring more transparency and result in more export forex inflows into the country.
The BOZ export tracking framework among other things requires exporters to open and maintain a bank account with a bank or financial institution domiciled in Zambia and that an exporter shall deposit all proceeds of exports of goods and/or services into this account within ninety (90) days from the date of export.
All exporters in Zambia are required to complete and submit to Zambia Revenue Authority (ZRA), the customs export declaration.
And the banks or financial institutions that receive these export proceeds are required to make a return or report to BOZ through submission of money receipts and remittances report on the electronic Balance of payment (e-BoP) Monitoring System.
The directive has also prescribed adequate penalties for exporters or banks or financial institutions that fail to comply, which include revocation of their tax clearance certificate and TPIN.-Zambian Business Times