- Peter Quirk
- Published Date:
- April 1995
The growing liberalization of exchange restrictions has generally been part of a broader program of stabilization and financial market reforms to foster market-based instruments of exchange and monetary policies. The efficient implementation of such structural reforms, and the associated technical assistance, requires a continuing comprehensive approach that links reforms of exchange markets with the development of monetary operations, banking supervision, payments systems, and other central banking and financial market functions.
Through its technical assistance, the IMF has helped member countries reform their exchange systems. Assistance is normally provided in the context of broader programs of macroeconomic adjustment and structural reforms, which may also include extensive financial sector reforms. IMF supported adjustment programs frequently incorporate actions recommended in the foreign exchange area as performance criteria, which has resulted in synergism between technical assistance and program discussions. Assistance in foreign exchange systems is also provided in the context of comprehensive programs of reforms of central banking designed to bring about effective and efficient implementation of monetary and exchange policies.
The main objective of technical assistance on exchange systems is to improve the public’s access to foreign exchange and the efficiency of foreign exchange allocation through reforms of exchange market arrangements and exchange controls. Assistance has focused on the establishment of institutional arrangements for foreign exchange markets, the elimination of exchange restrictions on payments and transfers for current international transactions, the unification of multiple exchange rates, the liberalization of capital movements, and the establishment of multilateral cross-border payment arrangements.
The precise strategy recommended to reform exchange systems depends on country-specific circumstances. Therefore, the first priority in assisting members has been to arrive at a full understanding of the operation of the existing exchange system, the institutional capacity of the financial system, the structure of foreign exchange flows, the authorities’ objectives for the exchange regime, as well as other socioeconomic and political constraints, and the exchange regime preferences of the national authorities.
Depending on the institutional capacity of the financial system and the structure of foreign exchange receipts and payments flows, the technical assistance mission may propose different institutional arrangements for the foreign exchange market. The final objective is normally an interbank market arrangement, which is likely to be the most efficient system. However, depending on the capacity of domestic financial institutions, including the central bank, the potential volume of transactions, and the degree of concentration of export receipts or import payments, transitional arrangements have occasionally been proposed and a sequence of reforms outlined. When a foreign exchange market initially lacks volume, pricing efficiency has sometimes been improved by the central bank’s or bankers association’s offer of facilities for buying and selling orders in an organized foreign currency exchange, alongside freedom for interbank transactions. As the market becomes more developed and the volume of transactions increases, floor-based exchange trading is likely to be increasingly supplanted by competitive off-floor trading through the interbank market. Hence, the institutional arrangements have allowed for a natural evolution toward decentralized interbank arrangements, for example, by allowing authorized dealers, both banks and non-banks, to establish freely their buying and selling rates with customers outside the foreign currency exchange. One important feature of technical assistance that has helped prevent or counter collusion in a number of countries is the introduction of nonbank trading.
The transparency of any exchange arrangement is critically important in order to establish confidence in the arrangement. In many cases, technical assistance has been provided to amend exchange control regulations and procedures. The regulations and procedures may need to be simplified and made more transparent as part of the process of improving access to foreign exchange, and of minimizing interference with the allocation mechanism. In the transition to a free system, it has often been recommended that the responsibility for operating exchange control regulations be delegated to commercial banks.
Technical assistance is often provided on operational and supervisory issues, including on the central bank’s intervention procedures and policies consistent with operating an interbank foreign exchange market. The assistance has included prudential supervisory and reporting requirements for the authorized dealers, codes of conduct for the interbank market, and back-office functions at the central bank.
Experience suggests that the reforms to the exchange system can proceed rapidly when the reforms are taken as part of a broader macroeconomic effort to stabilize the economy and are accompanied by necessary structural and institutional reforms. The effectiveness of existing exchange controls in protecting the balance of payments tends to be much overestimated, and technical assistance missions have often demonstrated this with estimates of capital flight and parallel market activities. Because of the existence of parallel exchange markets, the de facto degree of liberalization is usually greater than reflected in the official system. Exchange system liberalization has thus improved confidence, reducing capital flight and strengthening the balance of payments in addition to eliminating distortions.
Appendix Table 1 (see following page) lists IMF member countries that were the main recipients of MAE technical assistance on exchange systems during 1991–93 and summarizes the main focus of this assistance. Substantial assistance has been provided in building the necessary regulatory, institutional, and operational framework in a number of former centrally planned economies, including the countries of the former Soviet Union. In other countries, the technical assistance has focused on developing foreign exchange markets, reforming exchange controls, and building institutions.
|Country||Summary of Technical Assistance|
|Albania||Several areas of central hank operations were covered, including central bank’s foreign exchange operations and reserve management policy; improvements in operations of the interbank market were proposed.|
|Algeria||Comprehensive reform of the foreign exchange system implemented, including a floating rate regime in the context of an interbank market and liberal exchange system (current convertibility).|
|Armenia||Broad efforts to develop the basic operations of Central Bank, including foreign exchange operations; also development of foreign exchange market based on interbank system and the introduction of own currency were covered.|
|Azerbaijan||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system and introduction of own currency were covered.|
|Bangladesh||Reform of the foreign exchange market within the context of existing interbank system and liberalization of exchange system (to achieve current convertibility); also forward market operations of the Central Bank were reviewed.|
|Belarus||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, introduction of own currency, and the drafting of foreign exchange regulations were covered.|
|Bulgaria||Basic functions in developing the operations of the central bank were covered, including foreign exchange operations and policy and developing the foreign exchange market based on interbank system; also the calculation of the official exchange rate was covered.|
|Burundi||Broad assistance was provided to help authorities introduce market reforms in the foreign exchange system within the context of an interbank market, including open position limits, retention allowances, foreign exchange bureaus, and external accounts.|
|China||Comprehensive review of foreign exchange system, including the design of a strategy for unification of exchange rates, integration of foreign exchange trading, and reform of foreign exchange regulations.|
|Croatia||Comprehensive review of foreign exchange operations of the central bank and the interbank market in order to improve efficiency.|
|Egypt||Developments of foreign exchange operations reviewed in order to improve the functioning of the market; also measures toward convertibility were included.|
|Ethiopia||Modernization of the central bank and the establishment of a market-based exchange system within the context of a foreign exchange auction system.|
|Fiji||Further liberalization of capital controls.|
|Georgia||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, introduction of own currency, and drafting of the foreign exchange regulations were covered.|
|Indonesia||Review of monetary and foreign exchange operations to facilitate the existing full convertibility.|
|Iran, Islamic Rep. of||Further reforms in foreign exchange operations to develop interbank market and facilitate convertibility.|
|Jamaica||Review of foreign exchange market operations and the intervention policies of the central bank (capital convertibility achieved).|
|Kazakhstan||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system introduction of own currency, and drafting of the foreign exchange regulations were covered.|
|Kyrgyz Rep.||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system and introduction of own currency were covered.|
|Latvia||Review of foreign exchange policy of the central bank and assistance in the currency reform (current convertibility).|
|Lithuania||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, introduction of own currency, and drafting of the foreign exchange regulations were covered (capital convertibility achieved).|
|Madagascar||Comprehensive reform of the foreign exchange market in order to establish a market-based arrangement within the context of an interbank market, accompanied by exchange system liberalization.|
|Malawi||Review of foreign exchange operations of the central bank and establishment of a market-based exchange system within the context of an interbank market, together with weekly fixings.|
|Mauritania||Reform of the foreign exchange market in order to establish a market-based system; auctioning of import authorizations and freely determined exchange rate for certain transactions were included.|
|Moldova||Broad efforts to develop basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, supported by auction system, and introduction of own currency were covered.|
|Mongolia||Broad efforts to develop basic operations of central bank, including foreign exchange operations; also development of the foreign exchange market based on an interbank system, introduction of a floating rate system, and drafting of foreign exchange regulations.|
|Mozambique||Comprehensive exchange market liberalization within the context of an interbank market, auctions for tied funds, together with improvements in operations of the central bank and reporting systems.|
|Romania||Review of foreign exchange market operations and the fixing mechanism, improvements in foreign exchange regulations, and reserve management.|
|Russia||Broad efforts to develop the basic operations of Central Bank, including foreign exchange operations; also interbank market operations and exchange regulations were reviewed with the goal of enhancing the efficiency of foreign exchange markets.|
|Slovak Republic||Reforms of central bank’s operations, including foreign exchange operations and reserve management.|
|Sudan||Comprehensive reform of the foreign exchange system in order to establish an interdealer market, together with a flexible exchange rate.|
|Tajikistan||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market on the basis of an auction system.|
|Tanzania||Development of interbank foreign exchange market, which includes foreign exchange bureaus and an auction market; central bank’s operations were also reviewed.|
|Trinidad and Tobago||Further liberalization of foreign exchange system in the context of an interbank market and floating regime with achievement of capital convertibility.|
|Tunisia||Comprehensive reform of the foreign exchange market in order to establish an interbank system and current convertibility.|
|Turkmenistan||Broad efforts to develop the basic operations of Central Bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, including an auction market, introduction of own currency, and drafting of foreign exchange regulations.|
|Uganda||Exchange system reform to establish an interbank market and achieve current convertibility.|
|Ukraine||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, including an auction market, and introduction of own currency were covered.|
|Uzbekistan||Broad efforts to develop the basic operations of central bank, including foreign exchange operations; also development of foreign exchange market based on interbank system, including a fixing system, introduction of own currency, and drafting of foreign exchange regulations were covered.|
|Zimbabwe||Reform of the foreign exchange system to establish an interbank market.|
Technical assistance was provided in drafting new foreign exchange regulations for Belarus, Georgia, Kazakhstan, Lithuania, Mongolia, Turkmenistan, and Uzbekistan. The aim of the legal framework was to establish a unified foreign exchange market and current account convertibility and, in the case of Lithuania, capital account convertibility as well.
To facilitate a market-based foreign exchange allocation, comprehensive reform of the foreign exchange system was the primary purpose of MAE assistance in Algeria, Burundi, Ethiopia, Madagascar, Malawi, Mauritania, Mongolia, Mozambique, Sudan, Tanzania, Tunisia, Uganda, and Zimbabwe. In most cases, advice was given on the development of interbank and dealer markets. In Ethiopia, Malawi, Mozambique, and Tanzania, the IMF mission advised the authorities to adopt an auction or a centralized fixing arrangement as a transitional part of an emerging interbank foreign exchange market. In certain cases, the technical assistance focused on convertibility for current payments and transfers (Bangladesh and Tunisia), convertibility for capital transfers (Fiji, Jamaica, and Trinidad and Tobago), improving the operation of the existing foreign exchange market (Albania. Bulgaria. China, Croatia, Islamic Republic of Iran, and Romania), and reviewing forward exchange operations (Bangladesh).
Assistance on regional payments arrangements has included advice on the design and organization of the arrangements, consistent with a multilateral system of international payments. Assistance has been provided to the countries of the former Soviet Union on establishing the Interstate Bank (ISB), which could play a transitional role while the multilateral system of payments is being developed. The assistance on the ISB emphasized developing a framework that would avoid new exchange restrictions or distortions to members’ exchange systems, including avoiding undue delays in settlements, ensuring convertibility of receipts through the ISB, strictly limiting the credit provided through the ISB, and managing ISB positions consistent with a country’s exchange arrangements and foreign exchange market development. In the context of the regional integration initiatives for southern and eastern African countries, the approach to regional integration in exchange and payments systems involves developing a liberal multilateral exchange and payments system.
|Imports and Import Payments|
|Quantitative Import Controls|
|Albania||07/01/92||Liberalization||Import-licensing requirements abolished except those for hazardous materials and weapons.|
|Algeria||03/14/92||Tightening||List of prohibited imports issued.|
|03/26/92||Tightening||Importation of refrigerators and batteries suspended.|
|03/30/92||Tightening||Importation of tropical fruits suspended.|
|Argentina||04/01/91||Liberalization||Prohibition on importation of automobiles lifted and replaced with a quota on models not produced domestically.|
|Aruba||01/01/91||Liberalization||All products except eggs may be imported without restrictions; import restrictions to be administered liberally.|
|Australia||12/05/91||Liberalization||Changes in antidumping legislation.|
|Bangladesh||08/30/92||Liberalization||One hundred items removed from control list.|
|Bolivia||10/13/92||Liberalization||Licensing requirement on importation of sugar abolished.|
|Brazil||01/01/91||Liberalization||Two hundred fifty products used for data-processing equipment on restricted import list liberalized.|
|10/01/92||Liberalization||Restrictions on importation of information technology lifted.|
|Burkina Faso||01/01/91||Tightening||Several items added to the list of imported products subject to prior authorization.|
|07/17/91||Tightening||Several items added to list of products subject to special import authorization.|
|02/15/92||Liberalization||Import licenses merged into one single license.|
|07/21/92||Liberalization||Number of product categories for which special import authorization (ASI) is required reduced to 15, and that for which technical visa required reduced to 10.|
|Burundi||01/21/91||Liberalization||Value of import licenses commercial banks are authorized to approve raised to Fbu 50 million from Fbu 25 million.|
|12/30/91||Liberalization||Limit on value of import licenses commercial banks are authorized to approve removed.|
|04/01/92||Liberalization||Specific import licenses replaced with system of open general licenses.|
|Canada||06/15/92||Tightening||Imports of certain types of clothing from Cambodia, Lao People’s Democratic Republic, Oman, Qatar, and Swaziland restricted for the period June 15–December 31, 1992.|
|Cape Verde||12/30/91||Liberalization||Import-licensing system liberalized; import procedures simplified.|
|01/01/92||Liberalization||Quantitative restrictions on nonliberalized imports eliminated.|
|07/01/92||Liberalization||Quantitative restrictions on imports of cement eliminated.|
|Côte d’Ivoire||01/29/92||Liberalization||Phosphates, fertilizers, reinforced concrete, milling machines, and light vehicles added to list of freely importable goods.|
|former Czech and Slovak Federal Republic||06/13/91||Tightening||Quotas established for 1991 for imports of cattle, beef, coal, butler, and nine other agricultural products.|
|Ecuador||02/14/91 and 11/06/91||Liberalization||Number of prohibited imports reduced to 53 tariff nomenclatures from 900, and number of items subject to prior authorization reduced to 830 from 1,400.|
|02/07/92||Liberalization||Ban on automobile imports lifted.|
|Grenada||08/16/91||Tightening||Mops and children’s garments placed on negative list of imports.|
|09/01/91||Liberalization||Import-licensing requirement for goods originating from Organization of Eastern Caribbean States (OECS) countries eliminated.|
|Guyana||07/01/91||Liberalization||Processing of import-licensing applications further simplified, and several items removed from prohibited list.|
|Haiti||05/01/91||Liberalization||Licensing requirement for importation of rice suspended.|
|Honduras||02/01/91||Liberalization||Import-licensing requirement abolished for most goods.|
|03/14/91||Tightening||Special foreign exchange allocations for imports for relief of flood damage abolished.|
|Hungary||02/01/91||Liberalization||Priority Enterprise System and Normative Import Licensing System (SALDO) for licensing imports abolished.|
|01/01/92||Liberalization||Global import quota for consumer goods subject to import licensing for 1992 set at $720 million; quota on number of automobiles allowed to be imported set at 140,000.|
|India||01/05/91||Tightening||Sixteen raw materials and components removed from open general license (OGL) list and permitted to be imported only against replenishment licenses or additional licenses.|
|07/24/91||Liberalization||Procedures for importation of capital goods simplified.|
|08/01/91||Liberalization||All items not on limited permissible, restricted, or canalized lists freely importable under EXIM scrip, instead of under OGL system. Nonresident Indian nationals returning to India permanently for purpose of setting up small industries permitted to import under OGL all raw materials, except for restricted and canalized items, subject to value limit. Prior clearance requirement on the cumulative value of imports abolished.|
|02/18/92||Liberalization||Free use of foreign exchange up to Rs 5 million permitted for importation of capital goods.|
|04/01/92||Liberalization||Regime of import restrictions liberalized and changed to negative list consisting mainly of consumer goods.|
|04/01/92||Liberalization||List of canalized imports shortened.|
|Indonesia||06/03/91||Liberalization||Import restrictions on 322 items replaced by tariffs, reducing proportion of imports subject to administrative restrictions to 12 percent from 15 percent.|
|08/15/91||Tightening||Imports of completely built trucks prohibited.|
|Israel||09/01/91||Liberalization||Imports from countries with which Israel does not have free trade agreement modified. Discretionary import licensing of industrial goods replaced with automatic licensing procedure.|
|Italy||1991||Tightening||EU authorizes Italy to exclude six categories of products from application of Article 115 of Rome Treaty.|
|1992||Tightening||EU authorizes Italy to exclude two categories of products from application of Article 115 of Rome Treaty.|
|Jamaica||06/17/91||Liberalization||Import licenses no longer required for basic foodstuffs, motor vehicles, wood products, and fertilizers. Permits required for imports of motor vehicles for statistical purposes.|
|Japan||04/01/91||Liberalization||Import quotas on several food products eliminated.|
|Kenya||06/13/91||Liberalization||Items shifted to less restrictive treatment Schedule IIIB, except for goods restricted for health, security, or environmental reasons. This transfer essentially removes quantitative restrictions on imports.|
|02/01/93||Liberalization||Import and foreign exchange allocation licenses abolished.|
|Korea||07/01/91||Liberalization||Ninety-three items, mostly agricultural products, liberalized in accordance with 1989–91 import liberalization program.|
|Lebanon||12/17/92||Liberalization||Restriction on imports of wheat lifted.|
|Liberia||03/01/91||Liberalization||Monopoly right of Liberian National Petroleum Company (LNPC) to import petroleum products eliminated.|
|Malaysia||02/08/91||Liberalization||Ban on imports of steel bars lifted temporarily until July 31, 1991.|
|Mexico||01/26/91||Liberalization||Import-licensing requirements for 12 items abolished.|
|09/20/91||Liberalization||Import-licensing requirement for processed coffee abolished.|
|03/27/92||Tightening||Six items made subject to import-licensing requirements until March 31, 1993.|
|08/15/92||Tightening||Imports of meat restricted and subjected to prior approval.|
|11/12/92||Liberalization||Licensing requirement for imports of lobster, shrimp, prawn, and similar species abolished.|
|Morocco||02/14/92||Liberalization||Products not on negative list permitted to be imported without prior authorization.|
|Nepal||04/15/91||Liberalization||Goods permitted to be imported under import license auction system reclassified into two categories from five.|
|08/05/91||Liberalization||System of special auctions of import licenses for small enterprises introduced.|
|03/08/92||Liberalization||Most private sector imports transferred to the OGL list.|
|Netherlands Antilles||04/01/91||Liberalization||Quantitative restrictions on imports of a number of products that are domestically produced replaced with tariffs, at rates ranging up to 100 percent.|
|New Zealand||07/01/92||Liberalization||Import-licensing requirement for clothing eliminated.|
|Nicaragua||03/04/92||Liberalization||All restrictions on imports of foodgrains eliminated.|
|04/06/92||Liberalization||Quotas on the importation of rice, yellow corn, white maize, and sorghum replaced with variable levies.|
|Nigeria||03/24/92||Liberalization||Importation of medicine prescribed by physicians permitted.|
|10/22/92||Liberalization||Ban on wheat imports temporarily lifted.|
|Pakistan||03/01/91||Liberalization||Import-licensing requirements abolished, except those for products on negative or restricted lists.|
|04/03/91||Tightening||Acetic anhydride placed on restricted list.|
|07/01/92||Tightening||Acetone, acetyl, chlorine ethylidene, and asbestos added to list of goods that may be imported only by industrial consumers.|
|07/01/92||Liberalization||Ban on imports from South Africa lifted.|
|07/01/92||Liberalization||Twenty-one categories of goods removed from negative list.|
|08/24/92||Tightening||Benzidine and its derivatives placed on negative list.|
|09/13/92||Liberalization||Motorized taxis allowed to be imported and exempted from import regulations; and air-conditioned commuter vans allowed to be imported.|
|10/14/92||Liberalization||Cars and other motor vehicles allowed to be imported in knocked-down condition by recognized assemblers.|
|11/28/92||Liberalization||Large agricultural tractors of standardized makes permitted to be imported.|
|Panama||07/14/92||Liberalization||Importation of oil and oil products liberalized.|
|09/15/92||Liberalization||Quantitative restrictions on importation of rice abolished and replaced by a minimum import price plus an import tariff at the rate of 90 percent.|
|Paraguay||06/07/91||Tightening||Merchandise goods intended for retail sale in domestic market no longer permitted to be imported as accompanied luggage and required to be declared and identified in cargo invoice.|
|06/24/92||Liberalization||Import ban on dairy products, oil, cement, iron, cocoa, corn, wheat, and rice abolished.|
|07/10/92||Tightening||Ban on imports of broad list of agricultural and livestock products reinstated for 180 days.|
|Peru||03/23/91||Liberalization||All nontariff restrictions on imports and exports other than specific prohibitions for sanitary and security reasons eliminated.|
|03/27/91||Liberalization||All state monopolies on production and internal and external marketing of certain products eliminated.|
|03/29/91||Liberalization||Importation of used equipment authorized.|
|09/16/91||Liberalization||Foreign trade law guaranteeing free domestic and international trade enacted.|
|02/23/92||Liberalization||Importation of used machinery and equipment for industrial use, motor vehicles and parts, and transport equipment permitted.|
|05/26/92||Liberalization||New equipment used in productive processes, except transport vehicles, allowed to be imported temporarily by private enterprises.|
|07/25/92||Tightening||Importation of ammonium nitrate restricted to one public enterprise.|
|10/21/92||Liberalization||All restrictions on imports of used goods, except shoes and clothes, eliminated.|
|12/11/92||Liberalization||Mining enterprises allowed to import ammonium nitrate.|
|Philippines||03/18/91||Liberalization||Qualified importers allowed to import nonessential producer items.|
|03/19/91||Liberalization||Requirements for prior approval by government agencies lifted for 33 items.|
|04/27/92||Liberalization||One hundred thirty-nine products exempted from prior approval requirements.|
|07/27/92||Liberalization||Forty-two products exempted from prior approval requirements.|
|Romania||01/01/92||Liberalization||Import-licensing requirements abolished, with a few exceptions.|
|Rwanda||05/01/91||Liberalization||All quantitative restrictions intended to protect local industries removed.|
|06/01/91||Liberalization||Import-licensing system simplified.|
|06/01/91||Tightening||Nonrefundable 5 percent fee imposed on import licenses.|
|07/01/92||Liberalization||OGL system for imports introduced.|
|Sierra Leone||02/17/92||Liberalization||Ban on importation of cigarettes abolished.|
|Spain||1991||Tightening||EU authorizes Spain to exclude certain products originating from People’s Republic of China, Hong Kong, Japan, Republic of Korea, the Philippines, Taiwan Province of China, and the states of the former U.S.S.R. from the application of Article 115 of the Rome Treaty.|
|Sri Lanka||07/12/91||Liberalization||Ceiling on importation of goods for personal use of importers and for raw materials for industry and for spare parts for machinery (not in commercial quantities) increased to $1.000 from $500.|
|06/03/92||Tightening||Importers of potatoes and potato seeds required to obtain import license before authorized dealers can issue letters of credit.|
|06/09/92||Tightening||Importers of rice and various inorganic chemicals and compounds required to obtain import license before authorized dealers can issue letters of credit.|
|Sudan||02/05/92||Liberalization||Import-licensing requirement abolished, except for goods imported under defense or preferential trade agreements. Importers required to submit to authorized banks applications for imports of goods not included on negative list.|
|07/04/92||Liberalization||Several products excluded from negative list of imports.|
|Sweden||07/31/91||Liberalization||Import restrictions on textiles removed, effective on the planned expiry date of the Multifiber Arrangement (MFA), although the MFA was extended for 17 months.|
|Tanzania||01/01/91||Liberalization||Negative product list replaced positive list under the OGL system.|
|12/01/92||Liberalization||Minimum value of imports not requiring import licenses raised.|
|Thailand||04/16/91||Tightening||Import licenses required for imports of certain types of diesel engines and used cars. Imports of gambling machines prohibited.|
|Togo||05/30/91||Tightening||Imports of potatoes suspended from August 31, 1991 to February 28, 1992.|
|08/19/91||Tightening||Importation, stocking, or marketing of petroleum products by unauthorized entities prohibited.|
|04/22/92||Liberalization||Importation of concrete-reinforced bars permitted.|
|04/28/92||Liberalization||Prohibition on imports of frozen chicken and meat lifted.|
|Trinidad & Tobago||07/16/92||Liberalization||Most quantitative restrictions on imports of non-oil manufactured goods replaced by equivalent tariffs in the range of 4–45 percent and surcharges of up to 100 percent.|
|Tunisia||01/31/92||Liberalization||List of liberalized imports expanded.|
|05/29/92||Liberalization||List of liberalized imports expanded further.|
|Uganda||09/01/91||Liberalization||Firm–specific OGL system phased out.|
|12/15/91||Liberalization||More broadly based import system introduced.|
|United States||01/03/91||Liberalization||Tariff quotas increased for sugars, syrups, and molasses for period October 1, 1990 to September 30, 1991.|
|02/01/91||Tightening||Bangladesh and the United States agree to amend an agreement under the MFA to include restrictions on exports of cotton shop towels from Bangladesh.|
|07/01/91||Tightening||Uruguay and Untied States agree to extend restrictions on Uruguay’s exports of textile and apparel to the United Stales under the MFA.|
|07/05/91||Liberalization||Import restrictions on peanuts temporarily relaxed; peanut import quota increased to 100 million pounds for the year ended July 31, 1991.|
|Viet Nam||04/01/92||Liberalization||Imports of motor vehicles and motorcycles permitted, subject to annual quotas.|
|09/01/92||Tightening||Imports of 17 products temporarily prohibited for protective reasons.|
|10/01/92||Tightening||Importation of several consumer products banned.|
|12/01/92||Liberalization||Import bans on 7 of 17 products lifted.|
|Western Samoa||01/15/92||Liberalization||Six–month ban on imports of cigarettes and beer lifted.|
|Zambia||04/16/91||Tightening||Negative list of goods that could not be imported under export retention and no–fund import schemes published.|
|04/23/91||Liberalization||Coverage of OGL system expanded to include import categories equivalent to about 90 percent of merchandise imports.|
|05/08/92||Liberalization||Fertilizer added to list of products that may be imported under OGL.|
|09/21/92||Tightening||OGL system shifted to negative list system.|
|Zimbabwe||07/17/91||Liberalization||An unrestricted open general import license (OGIL) list introduced.|
|Advance Import Deposits|
|Bangladesh||02/19/91||Liberalization||Advance deposit requirement for commercial imports lowered to 25 percent from 50 percent.|
|04/12/91||Liberalization||Advance deposit requirement for commercial imports lowered to 20 percent from 25 percent.|
|10/02/91||Liberalization||Advance deposit requirement for commercial imports lowered to 10 percent from 20 percent.|
|1l/30/91||Liberalization||Ten percent advance deposit requirement for commercial imports abolished.|
|Colombia||01/09/91||Liberalization||Advance deposit requirement for imports abolished.|
|Costa Rica||01/07/91||Tightening||Rate of advance import deposit increased to 30 percent from 1 percent.|
|01/15/91||Tightening||Rate of advance import deposit increased to 70 percent.|
|02/15/91||Liberalization||Rate of advance import deposit lowered to 50 percent.|
|05/14/91||Liberalization||Rate of advance import deposit lowered to 30 percent.|
|Egypt||05/30/91||Liberalization||Advance import deposit rate for imports settled with letters of credit reduced to 10 percent from 35 percent in respect of imports for own use, and to 20 percent in respect of imports for resale.|
|08/08/92||Liberalization||Advance import deposit requirements abolished.|
|Guinea||08/03/92||Liberalization||Twenty-five percent advance deposit eliminated.|
|India||03/19/91||Tightening||Advance deposit requirement (cash margins) for raw material imports financed on letters of credit extended to all imports, except for imports of capital goods, and the rates increased to between 50 percent and 133⅓ percent. Imports by government departments and petroleum oil and lubricants, fertilizers, foodgrains, edible oil, newsprint, and life–saving drugs exempted.|
|04/01/91||Liberalization||Advance deposit requirement for imports by export–oriented units and exporters’ imports against advance licenses, advance intermediate licenses, imprest, licenses, and special imprest licenses for own consumption eliminated provided that exporters had no outstanding export bills exceeding six months of the export date. The ratio of advance deposits on imports against import replenishment (REP) licenses, additional licenses, and special additional licenses reduced to 50 percent from 100 percent, provided export proceeds fully realized.|
|04/22/91||Tightening||Ratios of advance deposits increased up to 200 percent.|
|04/22/91||Tightening||Prior clearance from the Reserve Bank required for letters of credit opened and/or remittances for imports by an individual exceeding Rs 20 million.|
|06/06/91||Liberalization||Advance deposits for imports other than capital goods exempted for certain manufacturers–exporters for up to 10 percent of actual export realizations during the previous accounting year, subject to ceiling of Rs 25 million. Noncapital goods imports under suppliers’ credits for one year or longer exempted from advance deposit requirement.|
|08/01/91||Liberalization||Imports of raw materials and intermediate goods used in the manufacture of bulk drugs and formulations exempted from advance deposit requirement.|
|08/09/91||Liberalization||Certain imports by manufacturers–exporters, export houses, and trading houses exempted from advance deposit requirement. Limit on exemption from advance deposit requirement for noncapital goods imports by certain manufacturers–exporters raised to 20 percent of previous year’s exports with a ceiling of Rs 50 million.|
|09/13/91||Liberalization||Imports of noncapital goods under the exporters earning import entitlement (renamed EXIM scrip) and of raw cashew nuts for processing exempted from advance deposit requirement.|
|10/08/91||Liberalization||Advance deposit requirement on OGL imports lowered to 150 percent. Limit on exemption from the advance deposit requirement for noncapital goods imports by certain manufacturers–exporters raised to 30 percent of the previous year’s exports with a ceiling of Rs 100 million.|
|12/09/91||Liberalization||Rate of advance deposits on most imports lowered to 50 percent from 150 percent.|
|02/12/92||Liberalization||Advance deposit requirement for noncapital goods imports abolished.|
|Jordan||05/26/92||Liberalization||Advance deposit requirement for imports into Jordan, or the free zone, and transit imports abolished.|
|Maldives||01/20/92||Liberalization||Fifty percent margin requirement for opening letters of credit by private sector importers abolished.|
|Malta||01/01/93||Liberalization||Advance payments for imports not exceeding Lm 10,000 would no longer require submission of supporting customs entry forms.|
|Nepal||08/05/92||Liberalization||Statutory margin deposit requirement abolished.|
|Sri Lanka||08/13/92||Liberalization||One hundred percent cash margin requirement against letters of credit opened for certain categories of imports eliminated.|
|Syrian Arab Republic||03/25/92||Liberalization||Import licenses granted without requirement of advance import deposits at the Commercial Bank of Syria.|
|Other import Measures|
|Algeria||04/01/91||Liberalization||All regulations requiring prior authorization to import and those controlling foreign exchange payments for imports abolished. All registered juridical and natural persons permitted to import goods not prohibited or restricted, without any prior authorization, provided importer is in possession of foreign exchange resources. Importers maintaining foreign currency accounts at authorized foreign intermediary banks allowed to use them to pay for imports.|
|04/01/91||Tightening||Payments for imports of gold, other precious metals, and precious stones allowed to be made only from foreign currency accounts.|
|04/01/91||Tightening||External borrowing by importers for import financing purposes required to be arranged through authorized intermediary banks. External borrowing may not exceed import value. For imports of less than $2 million in value, intermediary bank may combine import orders for combined financing. Imports of food products and other consumer goods, raw materials, semifinished goods, and capital goods used by essential industries encouraged to be financed with official lines of credit. For imports not eligible for official financing and for those imports eligible for official lines of credit but for which available lines have been totally drawn, banks are instructed to obtain credits with maturity of at least 3 years for capital goods and equipment and at least 18 months for other inputs. Short–term commercial credits may be obtained for wage goods. Imports with other financing arrangements must be referred to Bank of Algeria for review. Imports financed from foreign currency accounts exempted from above financing requirements and payments from these accounts would not require prior review or approval.|
|10/27/92||Tightening||Bank of Algeria introduced new guidelines concerning prioritization of imports and access to foreign exchange. Minimum financing maturity requirements apply.|
|Argentina||04/21/92||Liberalization||Imports and related payments by public sector no longer require prior approval from Central Bank.|
|Brazil||02/17/91||Liberalization||Minimum financing requirement for all imports abolished, and imports with financing terms from 361 days to 720 days exempted from prior authorization by Central Bank.|
|02/22/91||Liberalization||Official institutions in the field of education and technological research authorized to buy foreign exchange up to 360 days before due date of payments abroad.|
|Chile||08/27/92||Liberalization||Limit on import payments above which prior approval of Central Bank is required raised to US$100,000.|
|Colombia||10/01/91||Liberalization||Exchange licenses abolished.|
|Cyprus||11/05/92||Liberalization||Limit on advance payments for imports authorized dealers are permitted to make without prior approval from Central Bank increased to £C 20,000.|
|former Czech and Slovak Federal Republic||10/01/91||Liberalization||Regulations on import financing abolished.|
|Dominican Republic||03/20/92||Liberalization||Petroleum products, medicines, raw materials for the pharmaceutical industry, and basic food items transferred to interbank market.|
|Egypt||05/15/91||Liberalization||Requirement that letters of credit be opened for all imports abolished.|
|08/07/92||Liberalization||Advance import deposit requirement abolished.|
|Fiji||12/01/92||Liberalization||Limit on advance payments for imports authorized dealers are permitted to make without approval from Reserve Bank increased to F$10,000 per application.|
|12/01/92||Liberalization||Limit of F$500 on value of personal imports abolished.|
|Honduras||05/30/91||Liberalization||Ceilings on foreign exchange deposits and amount of these deposits that can be used to finance imports eliminated.|
|Hungary||02/01/91||Liberalization||Minimum value of imports above which contracts are required to be secured by letter of credit raised to Ft 10 million from Ft 2 million. Importers permitted to enter into deferred payment arrangements.|
|07/01/92||Liberalization||Requirement to secure import contracts by letter of credit was abolished.|
|India||03/19/91||Tightening||Letters of credit exceeding Rs 2.5 million and remittances for noncapital goods imports exceeding Rs 5 million require prior clearance from banks’ head offices and Reserve Bank, respectively. Imports of capital goods permitted only against foreign exchange lines of credit available with financial institutions and not against foreign exchange cash.|
|04/25/91||Liberalization||Commercial banks permitted to honor letters of credit for imports of capital goods opened on or before March 19, 1991, and to provide foreign exchange for capital goods imports shipped on or before this date.|
|06/06/91||Liberalization||Cumulative limit applicable to exporters for import payments requiring prior clearance by the Reserve Bank revised to Rs 20 million, plus 20 percent of the previous year’s exports, subject to ceiling of Rs 50 million.|
|07/04/91||Liberalization||System of REP licenses for exporters enlarged, with EXIM scrip equivalent to 30 percent of value of their exports compared with previous rates of 5–20 percent. Coverage of EXIM scrip enlarged to include all items on limited permissible list. OGL items for actual users, some nonsensitive items on canalized list, and non–OGL capital goods other than those on restricted list. All additional licenses abolished. Export and trading houses granted EXIM scrip rate of 35 percent. Supplementary licenses abolished except for small-scale sector and for producers of life-saving drugs and equipment. Replenishment rate for advance license exports increased from 10 percent to 20 percent of net foreign exchange earnings.|
|08/13/91||Liberalization||Certain export items became eligible for an additional EXIM scrip entitlement of 10 percentage points, raising the rate for these items to 40 percent of f.o.b. value. EXIM scrip rate of 30 percent made applicable, on a net foreign exchange basis, to certain service exports. Twenty import items decanalized. Replenishment rate for advance license exports increased to 30 percent.|
|11/14/91||Liberalization||Letters of credit or remittances for imports of noncapital goods exempted from advance deposit requirement no longer required to be cleared by Reserve Bank.|
|02/18/92||Liberalization||Free use of foreign exchange up to Rs 5 million permitted for importation of capital goods.|
|Israel||O8/02/92||Liberalization||Advance payments for imports of goods to be supplied within one year permitted.|
|Kenya||01/15/91||Tightening||Processing fee for foreign exchange applications for imports raised to 2 percent from 1.5 percent.|
|Malawi||01/10/91||Liberalization||Prior foreign exchange approval no longer required for 98.3 percent of nonpretroleum imports; remaining negative list covers certain luxury items.|
|Mauritius||07/01/92||Liberalization||Prior approval for advance payments for imports of goods other than spare parts and machinery abolished.|
|Mongolia||10/01/92||Liberalization||Private sector allowed to import petroleum products.|
|Mozambique||07/01/91||Liberalization||Product coverage under system of nonadministrative foreign exchange allocation expanded.|
|Pakistan||08/15/92||Liberalization||Spinning machinery excluded from purview of commercial imports against cash.|
|Peru||03/12/91||Liberalization||Temporary admission regime expanded to include all sectors of economy.|
|03/13/91||Liberalization||Advance payments of up to 100 percent of value of imports authorized.|
|04/30/91||Liberalization||National committees for rice, coffee, wheat, milk products, and hydrobiological products eliminated.|
|10/26/91||Liberalization||Operating rules for industrial free trade zones established.|
|Philippines||07/28/92||Liberalization||Revised rules governing foreign trade transactions promulgated.|
|09/15/92||Liberalization||Requirement that all imports by public and private sector borrowers funded by duly approved foreign loans be referred to Central Bank for prior clearance abolished.|
|11/23/92||Tightening||Finished products imported for direct resale no longer allowed to be financed under documents against acceptance or open account arrangements.|
|Senegal||11/14/91||Tightening||Merchandise import inspection program introduced.|
|11/28/91||Tightening||Requirement of bank domiciliation for import transactions exceeding CFAF 500,000 introduced.|
|Sierra Leone||08/01/92||Liberalization||Invoice entry fee on imports abolished.|
|Sri Lanka||12/11/91||Liberalization||Authorized dealers permitted to establish letters of credit on deferred payment terms for importation of goods in respect of high priority areas and for essential items without prior approval.|
|12/12/92||Liberalization||Limit on imports for personal use without letters of credit increased to the equivalent of $2,000. Imports for commercial purposes without letters of credit allowed up to the equivalent of $5,000.|
|Sudan||06/06/92||Liberalization||Authorized banks allowed under certain conditions to provide credit facilities for imports of specified capital goods.|
|Syrian Arab Republic||03/25/92||Liberalization||Thirty-four miscellaneous import items, which previously could be financed only through the 180-day external credit, allowed to be financed from export proceeds retained at Commercial Bank of Syria.|
|08/23/92||Liberalization||Imports eligible for financing with 180-day suppliers’ credits allowed to be settled with foreign exchange deposits held in Syria by Syrians residing abroad, foreign exchange deposits held abroad by importer, and foreign exchange deposited with Commercial Bank of Syria in accordance with the regulations on retention of export earnings.|
|Tanzania||04/21/92||Tightening||Imports with values exceeding $5,000 under OGL and effected through the foreign exchange bureaus required to be covered by letters of credit opened at commercial banks.|
|Thailand||02/07/91||Liberalization||License fees on imports of pigskin and scoured wool exempted.|
|Turkey||06/20/91||Liberalization||Banks permitted to extend foreign exchange credits to residents in Turkey for financing of capital goods imports and to extend such credits for working capital purposes. Importers of capital goods allowed to finance their imports directly from their private foreign exchange deposit accounts held with banks. Exporters, tourism enterprises, international transporters, and contractors allowed to pay for imports from foreign exchange earned from their activities.|
|11/20/92||Liberalization||Advance payments for all imports permitted for all products and without guarantees of importing firms. Unless specifically prohibited, all import payments allowed to be made from importers’ foreign exchange deposit accounts.|
|11/20/92||Liberalization||Importers allowed to utilize credits obtained from export credit institutions, or under their guarantees, to effect payments to suppliers through banks abroad.|
|Uruguay||07/07/92||Liberalization||Domestic content and compensatory export requirements for automobile assembly industry eliminated.|
|11/12/92||Liberalization||Number of reference import prices reduced to 90, and number of minimum export prices (applicable to goods imported into the country) reduced to 34.|
|Viet Nam||04/01/92||Liberalization||Private commercial trading houses permitted to engage in import and export activities.|
|Yugoslavia, former Socialist Federal Rep. of||07/04/91||Tightening||With certain exceptions, commercial banks prohibited from making advance payments for imports of goods and services.|
|Zambia||08/01/91||Tightening||Threshold value above which “no funds” imports are subject to preshipment inspection reduced to $10,000 from $15,000.|
|Zimbabwe||01/01/92||Liberalization||Supplementary allocations of foreign exchange to industrial exporters discontinued.|
|Exports and Export Proceeds|
|Albania||07/01/92||Liberalization||Export-licensing requirements abolished except those for 21 product groups.|
|Algeria||06/22/92||Tightening||Exportation of cast iron and some leather items suspended.|
|Bulgaria||07/01/92||Liberalization||All export bans eliminated, and export quotas maintained on nine categories of goods. Export licenses granted automatically.|
|12/01/92||Liberalization||Export quotas replaced by export duties.|
|03/15/93||Tightening||Temporary ban introduced on exports of grain to be in effect until September 30, 1993.|
|Burkina Faso||07/17/91||Tightening||Exports of maize, millet, sorghum, rice, and ivory prohibited.|
|02/19/92||Liberalization||All export licenses merged into one single license.|
|07/21/92||Liberalization||Number of product items for which special export authorization is required reduced to three.|
|Burundi||04/23/91||Liberalization||Commercial banks authorized to issue export licenses.|
|Cape Verde||01/01/92||Liberalization||Licensing requirement for exports and re-exports eliminated.|
|Côle d’Ivoire||01/02/91||Tightening||List of wood products subject to export quotas expanded to include those that had undergone first stage of processing. A system of establishing export quotas through auction introduced.|
|10/01/91||Tightening||New system of export licensing for coffee and cocoa put into effect. New system of determining export price of coffee and cocoa introduced.|
|former Czech and Slovak Federal Republic||05/01/91||Liberalization||Export-licensing requirements for several products abolished.|
|Ethiopia||01/30/92||Liberalization||Importation of goods on a franco valuta basis (that is, imports financed with foreign exchange from external sources) liberalized.|
|Honduras||06/23/92||Liberalization||System of export permits eliminated.|
|Indonesia||06/03/91||Liberalization||All restrictions on exports of edible oils eliminated.|
|Lao People’s Democratic Republic||08/01/91||Tightening||Exports of timber prohibited.|
|09/10/91||Liberalization||Ban on timber exports lifted.|
|06701/92||Liberalization||Ban on exports of timber lifted.|
|Mauritius||07/01/92||Liberalization||Export permit requirement abolished.|
|Mexico||02/24/91||Liberalization||Limit over which export proceeds were required to be surrendered at the controlled market rate was increased to $50,000 a week.|
|09/20/91||Liberalization||Export-licensing requirement for 11 items (including wheat, sorghum, and cotton sheets) abolished.|
|05/04/92||Liberalization||Licensing requirement for cattle exports abolished.|
|06702/92||Liberalization||Export-licensing requirements for 227 items abolished.|
|06/02/92||Liberalization||Prohibition on trade with South Africa lifted, with some exceptions.|
|07/03/92||Liberalization||Licensing requirement for tequila exports abolished.|
|09/03/92||Liberalization||Licensing requirement for shrimp exports abolished.|
|Oman||09/01/91||Liberalization||All quantitative export restrictions eliminated.|
|Pakistan||07/01/91||Liberalization||Limit on the value of trade samples that can be exported without prior approval raised.|
|Papua New Guinea||07/01/92||Liberalization||Two-year ban on issuance of permits for timber operations eliminated.|
|Paraguay||01/28/91||Tightening||Exports of certain fine processed woods prohibited.|
|Peru||03/24/91||Liberalization||List of restricted exports abolished.|
|06/04/92||Liberalization||Exports of mining products would no longer require special authorization.|
|Sri Lanka||01/01/92||Liberalization||Re-exportation of goods under entrepôt trade permitted.|
|03/17/92||Liberalization||Limit on exportation of gifts and trade samples raised.|
|01/15/93||Liberalization||Limits on exports of gifts, trade samples, and personal effects and jewelry to be reimported increased by 50 percent.|
|Sudan||10/27/92||Liberalization||Ban on exportation of sorghum and pearl millet lifted.|
|11/05/92||Liberalization||Ban on exportation of cotton seed cake and wheat bran lifted.|
|Thailand||03/18/91||Liberalization||Maximum value for exports of jewelry, gold, and platinum raised.|
|02/04/92||Liberalization||Export controls on certain products lifted.|
|Tonga||07/01/92||Tightening||Quota established for squash exports.|
|United States||02/04/91||Liberalization||Certain export documentation requirements for export licenses, re-export authorization, or amendment eliminated, except for exports of supercomputers to certain countries.|
|02/12/91||Liberalization||Exports of certain dynamic random-access memory chips to certain countries no longer require export licenses.|
|03/20/91||Liberalization||Exports of certain gallium arsenide to certain countries would not require export licenses, except for those to the Islamic State of Afghanistan and the People’s Republic of China.|
|04/25/91||Liberalization||Export controls against the former Czech and Slovak Federal Republic, Hungary, and Poland liberalized.|
|05/27/91||Tightening||Ban imposed on exports of high-speed computers and satellite-related equipment to People’s Republic of China.|
|09/01/91||Liberalization||New and less restrictive rules governing high-technology exports to Eastern Europe and the states of the former Soviet Union implemented.|
|Uruguay||09/30/92||Liberalization||Ban on exportation of livestock abolished.|
|Viet Nam||04/01/92||Liberalization||Export quotas for rubber and coffee abolished.|
|04/01/92||Tightening||Exports of logs and certain forestry products, previously subjected to quotas, prohibited for environmental reasons.|
|10/01/92||Tightening||Importation of following products banned: batteries, bicycles, chinaware, cosmetics, electric bulbs, fans, glass sheets, plastic items, processed food, soap, and thermos flasks.|
|Western Samoa||01/01/92||Tightening||Exportation of taro banned from January 1 to May 31.|
|Fiscal and Other Incentives|
|Argentina||05/01/91||Liberalization||Duty rebate scheme modified, whereby payments to be made in cash instead of partly in austral-denominated bonds.|
|11/01/92||Tightening||System of export rebates modified.|
|Bangladesh||07/01/92||Liberalization||Cash subsidy on jute exports abolished.|
|Bhutan||07/01/91||Liberalization||Cash subsidy for exports to countries other than India reduced.|
|Bolivia||03/15/91||Liberalization||Customs duty rebate certificate for exporters of nontraditional products abolished and replaced by customs duty reimbursement at reduced rates.|
|China||01/01/91||Liberalization||All export subsidies eliminated.|
|Ecuador||11/22/91||Liberalization||Scheme by which exporters were compensated for sucre devaluations eliminated.|
|El Salvador||11/26/92||Liberalization||Rate of drawback of taxes paid in the form of certificates on imported raw materials by exporters of nontraditional products to markets outside Central America reduced.|
|Kenya||01/10/92||Liberalization||Rate of export compensation for duties paid on imported inputs reduced.|
|Nigeria||12/01/92||Tightening||An export processing zone became operational.|
|Thailand||02/19/91||Tightening||Tax rebates on exports of passenger cars increased.|
|Turkey||02/05/91||Tightening||Incentive scheme for free trade zones and tourism sector amended to encourage investment.|
|08/20/91||Tightening||Number of products eligible to receive premium payments from Support and Price Stabilization Fund increased. 1 Direct monetary payments eliminated.|
|Argentina||03/22/91||Liberalization||All export taxes eliminated, except those on sunflower seeds and soybeans.|
|11/01/91||Elimination||Three percent statistical levy on f.o.b. value of exports abolished.|
|Brazil||03/01/91||Liberalization||Tax on exports of three-phase engines to Canada eliminated.|
|02/01/92||Tightening||A tax of 3 percent levied on exchange contracts not supported by shipments.|
|China||08/15/91||Liberalization||Export duties on a number of products (e.g., lead ore, phosphorus, ferromanganese, aluminum, and zinc ore) were reduced from 50 percent to 20-30 percent.|
|Colombia||01/09/91||Liberalization||Taxes on coffee exports abolished and replaced by a coffee contribution.|
|El Salvador||12/17/92||Liberalization||Export tax on coffee exports replaced by an income tax on export earnings.|
|Ethiopia||12/15/92||Liberalization||All export taxes and duties on products other than coffee eliminated.|
|Honduras||12/31/91||Liberalization||Export lax on traditional exports eliminated.|
|11/05/92||Tightening||Export tax on coffee raised to 20 percent.|
|Malaysia||03/01/91||Tightening||Export levy imposed on sawn limber.|
|Mauritania||02/02/91||Tightening||Tax levied on exports of fish and crustaceans.|
|Mongolia||07/01/91||Liberalization||Export taxes eliminated.|
|Nicaragua||02/11/91||Liberalization||Coffee, cotton, sugar, some sesame, beef, and molasses exempted from export tax.|
|Paraguay||01/28/91||Tightening||A 1 percent surcharge was levied on exports of beef.|
|02/22/91||Tightening||Temporary 3 percent surcharge imposed on reference price for certain exports of soybeans.|
|09/05/91||Liberalization||Nontraditional exports exempted from export levies.|
|10/03/91||Liberalization||List of nontraditional exports exempted from export levies expanded.|
|Peru||03/17/91||Liberalization||All export taxes eliminated.|
|03/19/91||Liberalization||Temporary mechanism established, whereby exporters receive credit against their income and wealth taxes for taxes (tariffs, value added, and social security) paid on exported goods.|
|04/03/91||Tightening||Taxes imposed through December 1991, on exports of copper, silver, zinc, and lead, and nonmining traditional exports.|
|Sudan||02/04/92||Liberalization||Export tax rates amended.|
|02/18/92||Liberalization||Export lax rates amended.|
|02/16/92||Liberalization||All exports to Egypt to be settled under the trade and payments agreement exempted from export tax.|
|04/07/92||Tightening||Export tax rate on livestock raised to 40 percent.|
|07/01/92||Liberalization||Export tax rates amended.|
|Venezuela||06/01/92||Liberalization||Export surcharge on petroleum exports reduced.|
|Special Credit Facilities|
|Argentina||03/08/91||Liberalization||Regulations governing prefinancing and financing of “promoted exports” tightened.|
|09/03/91||Tightening||Export financing regime introduced on temporary basis.|
|Brazil||06/01/91||Tightening||Export financing program.|
|02/01/92||Tightening||Maximum period for pre-export financing that may be obtained against exchange contracts reduced from 1 year to 180 days.|
|Colombia||01/28/91||Liberalization||Surrender requirement eased.|
|Jordan||08/01/92||Liberalization||(1) Maximum coverage of preshipment rediscounting facility increased to 75 percent of total value of export credits; (2) maximum coverage of postshipment rediscounting facility increased to 90 percent of total value of bills, bank drafts, and collections; (3) lending rate to banks on export financing set at 3.5 percent below prevailing discount rate: (4) maximum period on export credits for all countries extended to nine months: and (5) minimum percentage of local value-added tax accepted by the Central Bank for export financing purposes reduced to 25 percent.|
|Pakistan||07/01/92||Tightening||Export-output ratio required to qualify for the exporter scheme lowered to 50 percent in first two years and 60 percent subsequently.|
|Philippines||04/22/92||Liberalization||Exporters of services allowed to avail themselves of loans from U.S. dollar-based credit facility without obtaining prior approval from Central Bank.|
|Sri Lanka||08/15/91||Liberalization||Exporters permitted to borrow from foreign currency banking units to import inputs up to 75 percent of value of confirmed export orders.|
|Turkey||08/20/91||Tightening||Financing by the Support and Price Stabilization Fund through Turkish Eximbank introduced.|
|Albania||07/01/92||Liberalization||Surrender requirement on proceeds from exports abolished.|
|Algeria||03/22/92||Liberalization||Commercial banks no longer obliged to surrender to central bank foreign exchange deposited in foreign currency accounts, proceeds from exports other than hydrocarbons, or borrowed foreign exchange, in practice, however, this surrender requirement remains in place.|
|Argentina||04/08/91||Liberalization||Surrender requirements on export proceeds abolished.|
|Bangladesh||07/01/92||Liberalization||Foreign exchange retention ratio for exporters increased to 10 percent from 2-2.5 percent, except for exporters of low value-added products, including garments, for which retention ratio set at 5 percent.|
|Bolivia||12/17/91||Liberalization||Export procedures simplified.|
|Brazil||06/01/91||Liberalization||Exporters allowed to issue medium-term debt instruments secured with future export receipts.|
|Chile||03/17/92||Liberalization||Rates at which foreign exchange earnings exporters allowed to retain in special foreign exchange deposit accounts increased.|
|China||01/01/91||Liberalization||Foreign exchange retention by enterprises on a uniform basis introduced, under which proportion of foreign exchange quotas no longer depends on location of enterprise.|
|Colombia||06/24/91||Liberalization||Surrender requirement modified.|
|01/28/92||Liberalization||Export surrender requirements liberalized further; authorization to retain part of the export proceeds abroad extended to all exporters.|
|Costa Rica||03/01/92||Liberalization||Exporters allowed to keep up to 10 percent of earnings to meet their own foreign exchange needs.|
|Dominican Republic||03/20/92||Liberalization||Surrender requirement for proceeds from exports from free trade zones suspended.|
|Ecuador||09/03/92||Tightening||Fifteen percent of private export receipts required to be surrendered against non-interest-bearing. U.S. dollar-denominated exchange certificates, with option of redeeming certificates in dollars at maturity (180 days) or selling them in the secondary market.|
|10/14/92||Tightening||Option of early surrender of export receipts to Central Bank eliminated.|
|11/26/92||Liberalization||Private sector exporters permitted to sell their export receipts in free market.|
|11/26/92||Liberalization||Option of early surrender of export receipts reinstated but would be allowed only through authorized financial entities.|
|Egypt||02/27/91||Liberalization||Requirement that 50 percent of proceeds from certain exports had to be sold to commercial banks abolished.|
|10/08/91||Liberalization||Government, Suez Canal authorities. Sumed. Egyptian Petroleum Corporation, and cotton and rice exporters no longer required to sell their foreign exchange receipts exclusively to Central Bank.|
|Fiji||12/01/92||Liberalization||Exporters permitted to retain up to 10 percent of proceeds in foreign currency accounts held with authorized dealers or banks abroad and to use balances to make import payments.|
|Guinea||06/30/92||Liberalization||Exporters allowed to retain up to 25 percent of proceeds from exports in foreign exchange deposits with Guinean commercial banks.|
|Honduras||01/24/91||Liberalization||Time limit for surrendering foreign exchange proceeds from exports of minerals and nontraditional goods extended to 120 days.|
|05/04/92||Tightening||Period for surrendering proceeds from exports of coffee and bananas shortened to 25 days and that for other exports to 25-85 days.|
|10/04/92||Liberalization||Proportion of foreign exchange purchased by commercial banks required to transfer to the Central Bank reduced to 30 percent. Commercial banks would be allowed to sell up to one-third of this amount freely, with a maximum limit of $1,500 a transaction.|
|Jordan||01/11/92||Tightening||Commission on all payments by Jordanian exporters through the Central Bank for commodities exported in accordance with bilateral trade agreements increased.|
|Kenya||02/01/93||Liberalization||Coverage of foreign exchange earnings that exporters may retain in their retention accounts extended.|
|03/22/93||Tightening||Export retention scheme suspended. Import and foreign exchange allocation licenses reintroduced.|
|05/14/93||Liberalization||Export retention scheme reintroduced at rate of 50 percent for all exports, import and foreign exchange allocation licenses abolished, except for short negative list of goods prohibited for health, security, or environmental reasons.|
|Madagascar||10/01/91||Tightening||Proceeds from exports subjected to 100 percent surrender requirement. Authorized banks required to transfer immediately 40 percent of surrendered foreign exchange to Central Bank, and any balances not utilized within 72 hours also required to be transferred to Central Bank.|
|10/01/92||Liberalization||A number of large enterprises permitted to retain all their foreign exchange receipts.|
|Malta||01/01/93||Liberalization||Export proceeds allowed to be credited to an authorized foreign currency account and used for any authorized transaction within three months, after which the balance would be converted to domestic currency.|
|Mauritius||07/01/92||Liberalization||Exporters made eligible to operate foreign exchange accounts with commercial banks.|
|Mexico||02/19/91||Liberalization||Measures announced to promote exports through deregulation and fiscal and customs measures.|
|06/18/91||Liberalization||Measures to promote exports announced.|
|Mongolia||03/01/92||Liberalization||Ratios of surrender requirements applicable to proceeds of exports by state enterprises amended.|
|Mozambique||07/01/91||Liberalization||Proceeds from nontraditional exports allowed to be sold in secondary exchange market.|
|Myanmar||10/25/91||Liberalization||List of products not allowed in border trade expanded.|
|Nepal||07/15/92||Liberalization||Export retention ratio raised to 75 percent.|
|Nicaragua||09/02/91||Liberalization||All export transactions required to be handled through the commercial banking system. Maximum period for surrendering proceeds from exports to commercial banks reduced.|
|06725/92||Liberalization||Proceeds from exports from free zone and 75 percent of proceeds from exports of seafood products to countries outside the zone allowed to be retained in special account with a commercial bank and used for import payments.|
|Peru||03/12/91||Liberalization||Surrender requirements for export proceeds simplified.|
|04/04/91||Liberalization||Firms producing inputs for domestic exports eligible to participate in temporary admission regime.|
|04/17/91||Liberalization||System of sanctions for infractions of foreign exchange surrender requirements suspended.|
|Philippines||07/02/91||Liberalization||Exporters allowed to retain 2 percent of export receipts from each shipment in special foreign currency deposit account.|
|08/28/91||Liberalization||Exporters allowed to submit shipping documents within ten banking days (instead of seven days) after completion of loading.|
|10/15/91||Tightening||Foreign exchange proceeds from commodity exports required to be repatriated within 90 days of date of shipment.|
|01/03/92||Liberalization||Retention ratio for exporters raised to 40 percent.|
|03/03/92||Liberalization||Requirement to file report of foreign sales by exporters abolished.|
|04/01/92||Liberalization||Exporters allowed free use of Rinds deposited in special foreign currency accounts.|
|04/28/92||Liberalization||Retention privilege of exporters of goods extended to service exporters.|
|07/28/92||Liberalization||Export transactions liberalized.|
|08/13/92||Liberalization||Bulgaria, Cambodia, Cuba, Romania, and the states of the former U.S.S.R. removed from the list of socialist and other centrally planned economies, and exports to and imports from these countries would no longer require clearance.|
|08/24/92||Liberalization||(1) Authorized banks allowed to issue monthly export declaration without prior approval from Central Bank; (2) changes to export declaration allowed without prior approval from Central Bank; (3) intercompany open account offset arrangements allowed without prior approval from Central Bank; (4) deductions from export bills permitted; (5) export clearance for exports payable beyond 180 days of shipment date do not require prior approval from Central Bank: (6) the retention rate of export receipts increased to 100 percent, and proceeds allowed to be used freely for any purpose; (7) all exports to inconvertible currency areas no longer require prior approval from the Central Bank; and (8) authorized banks not required to submit to the Central Bank Export Department reports on the opening, closing, or outstanding balances of special foreign currency deposit accounts.|
|08/24/92||Liberalization||Rules on intercompany open account offset arrangements, exports made on a consignment basis, inward remittances and payment periods, exports requiring prior approval from Central Bank, and the use of special foreign currency deposit account (SFCDA) and non-dollar expoits requiring prior approval from Central Bank repealed.|
|08/24/92||Tightening||Repatriation of export proceeds within 180 days of date of shipment required.|
|Sierra Leone||03/19/91||Liberalization||Two percent preinspection fee waived on cocoa and coffee exports.|
|01/01/92||Liberalization||Requirement that licensed diamond exporters must sell 20 percent of export proceeds to Bank of Sierra Leone abolished.|
|03/12/92||Liberalization||Exporters of marine products no longer required to open letters of credit or surrender their export proceeds to Bank of Sierra Leone.|
|Spain||04/16/91||Liberalization||All foreign exchange proceeds allowed to be maintained in foreign accounts.|
|Sri Lanka||08/01/91||Liberalization||Exporters permitted to credit 5 percent of their incremental export earnings over the previous year to resident foreign currency accounts.|
|03/29/93||Liberalization||Repatriation and surrender requirements in respect of export proceeds abolished: limits on exports of gifts, trade samples, and personal effects and jewelry to be reimported abolished.|
|Sudan||12/13/92||Tightening||Minimum export prices established for certain products.|
|12/13/92||Liberalization||An export promotion scheme for exporters of goods subject to minimum export prices introduced.|
|Syrian Arab Republic||06/17/91||Tightening||A list of items for which public sector exporters can retain 50 percent of proceeds revoked.|
|Tanzania||04/01/92||Tightening||Surrender requirement ratio for traditional exports introduced at 10 percent and ratio for nontraditional products raised to 50 percent.|
|Thailand||05/20/91||Liberalization||Surcharges on exports of ball bearings to EU reduced.|
|06/27/91||Liberalization||Business tax on certain exports of locally produced mineral products reduced.|
|05/01/92||Liberalization||Exporters allowed to accept payments in domestic currency from nonresident baht accounts without prior approval from central bank. Exporters permitted to use proceeds to service external obligations and pay for imports without depositing proceeds in domestic banking accounts.|
|Turkey||08/20/91||Tightening||Number of products eligible to receive premium payments from Support and Price Stabilization Fund increased. Direct monetary payments, including Support and Price Stabilization Fund premiums eliminated.|
|11/20/92||Tightening||(1) Twenty percent of export proceeds required to be sold to commercial banks within 180 days of shipment: (2) when export proceeds are repatriated within 90 days of shipment, exporters allowed to use proceeds to make import- and export-related invisible payments.|
|Uganda||03/31/91||Liberalization||An export certificate system streamlining procedures introduced. Based on this system, exporters required to complete an application for an export certificate valid for six months and renewable.|
|Zambia||03/11/92||Liberalization||Percentage of export earnings that exporters of nontraditional products may retain raised to 100 percent.|
|Zimbabwe||12/31/91||Liberalization||Export retention scheme (ERS) expanded and modified.|
|12/29/92||Liberalization||ERS extended to cover payments for invisibles, specifically business travel, commissions, and professional, technical, training, marketing, and administration fees.|
|Burundi||06/30/91||Liberalization||Private traders permitted to export up to 30 percent of the 1991/92 coffee crop.|
|India||08/13/91||Liberalization||Sixteen export items previously reserved for slate trading enterprises decanalized.|
|04/01/92||Liberalization||List of canalized exports shortened.|
|Vict Nam||04/01/92||Liberalization||Private commercial trading houses permitted to engage in export and import activities.|
|Foreign Exchange Allocations for Travel, Medical Treatment. Studies Abroad, and Family Maintenance|
|Bangladesh||06/15/91||Liberalization||Foreign exchange allowances for travel by Bangladeshi nationals increased.|
|Belize||11/01/91||Liberalization||Limit on foreign exchange allowances abroad abolished, and authorized dealers permitted to provide foreign exchange for correspondence courses.|
|03/01/92||Liberalization||Foreign exchange allowances for travel increased.|
|Brazil||09/30/92||Liberalization||Foreign exchange to pay for medical treatment abroad allowed to be purchased in floating exchange market.|
|10/14/92||Liberalization||Foreign exchange to pay for expenses relating to sports events allowed to be purchased in floating exchange market.|
|10/21/92||Liberalization||Foreign exchange to pay for exhibits abroad allowed to be purchased in floating exchange market.|
|Bulgaria||12/23/91||Liberalization||Residents traveling abroad allowed to purchase foreign exchange up to the equivalent of leva 10.000 a year.|
|Chile||03/17/92||Liberalization||Limits increased on foreign exchange for tourist travel to Latin American countries, study abroad, subscriptions to magazines and books, registrations for seminars, social security payments, medical treatment, and remittances of rents earned by real estate owners living abroad.|
|China||12/01/91||Liberalization||Chinese residents allowed to purchase foreign exchange with domestic currency in order to travel, live, or study abroad.|
|former Czech and Slovak Federal Republic||04/01/91||Liberalization||Annual foreign exchange entitlement for travel abroad by private citizens increased.|
|Fiji||12/01/92||Liberalization||Limits on foreign exchange authorized dealers are permitted to provide without approval from central bank increased for family maintenance expenses, subscription payments, travel allowances, royalties, commissions, patents, brokerage, copyrights, and gifts.|
|12/01/92||Liberalization||Prior approval from central bank not required to make payments for medical treatment and payments by shipping companies to foreign crew members and for advertising, movie film rental, and news services.|
|Greece||05/01/91||Liberalization||Travel allowances for travel to ED countries raised.|
|03/04/92||Liberalization||(1) Liberalization of travel payments and use of international credit cards by residents of Greece traveling to EU countries extended to non-EU countries; (2) payments by residents traveling abroad for business liberalized; and (3) exchange allowance for education abroad liberalized. Authorized banks allowed to provide amounts in excess of monthly indicative limits upon presentation of proof of need.|
|Guinea||02/28/91||Liberalization||Daily foreign allowance for government officials traveling abroad on official business raised.|
|Hungary||12/23/91||Liberalization||Additional allowances granted for private travel arranged through travel agents. New regulations introduced for business travel.|
|07/01/92||Liberalization||Travel allowances for tourism raised. Official travel subject to same allowances as those applicable to business travel.|
|India||06/01/92||Liberalization||Fifteen percent tax on foreign exchange sold for travel abroad abolished.|
|Israel||01/01/93||Liberalization||Tax of NIS 250 on travel abroad by residents abolished.|
|Jamaica||09/25/91||Liberalization||Limits on remittances of dividends and profits, transfers abroad for family maintenance purposes, and foreign exchange allowance for personal and business travel eliminated.|
|Kenya||12/23/92||Liberalization||Adult pilgrimage allowance raised.|
|Lesotho||09/30/91||Liberalization||Basic annual exchange allowance for travel increased.|
|Malawi||05/01/92||Liberalization||Maximum amount of foreign exchange authorized dealers permitted to provide for business travel increased.|
|Malta||01/01/93||Liberalization||Travel allowance system based on length of trips taken abolished.|
|02/01/93||Liberalization||Ten percent levy on foreign exchange for travel services removed.|
|Mauritania||10/18/92||Liberalization||Foreign exchange allowance for travel and medical treatment increased.|
|12/06/92||Liberalization||Foreign exchange allowances for certain invisibles increased.|
|Mauritius||07/01/91||Liberalization||Limit on personal travel allowance raised.|
|07/01/92||Liberalization||Travel allowance limit of Rs 200.000 a person for residents during a period of two calendar years abolished.|
|Morocco||09/17/91||Liberalization||Installation allowance for Moroccan students pursuing studies abroad increased to DH 10,000.|
|11/01/91||Liberalization||Annual foreign exchange allowances for business travel introduced.|
|09/02/92||Liberalization||Authorized banks, postal services, and office of Treasury Collector allowed to transfer living expenses in favor of Moroccan students abroad.|
|09/16/92||Liberalization||Moroccans traveling abroad as tourists or for religious purposes granted foreign exchange allowances equivalent to DH 5.000 a year.|
|01/13/93||Liberalization||Authorized banks allowed to provide foreign exchange allowances equivalent to DH 20.000 for professional travel by individuals covered under existing allowance system.|
|Namibia||09/01/92||Liberalization||Limits on annual allowances for tourist and business travel raised.|
|Nepal||03/08/92||Liberalization||Restrictions on payments for most invisibles abolished.|
|Pakistan||02/07/91||Liberalization||Foreign exchange made available for all correspondence courses.|
|02/13/91||Liberalization||Restrictions on remittances abroad for undergraduate studies eliminated.|
|Papua New Guinea||11/20/92||Liberalization||Authorized foreign exchange dealers allowed to approve invisibles payments and transfers for amounts up to the equivalent of leva 500,000 a year per resident for any purpose.|
|Peru||02/09/91||Liberalization||All quantitative limits on payments for services eliminated.|
|12/24/92||Liberalization||Tax on travel abroad abolished.|
|Philippines||01/03/92||Liberalization||Amounts of foreign exchange available to residents for certain purposes without prior central bank approval increased.|
|04/28/92||Liberalization||Retention privilege of exporters of goods extended to exporters of services.|
|08/24/92||Liberalization||All quantitative limits on amount of foreign exchange authorized banks may sell to residents for travel, education, and medical expenses eliminated.|
|Rumania||05/13/91||Liberalization||Persons residing in Romania permitted to take out of the country foreign exchange or to transfer it abroad through banks for current account transactions. All economic agents allowed to transfer abroad foreign exchange purchased with lei through authorized commercial banks for current account transactions; transfers exceeding the equivalent of $10,000 would require prior authorization from the central bank.|
|Sierra Leone||10/09/92||Liberalization||Amount of exchange allowance for travel, studies, and medical treatment abroad that commercial banks may provide without prior approval from central bank increased.|
|Solomon Islands||01/20/92||Tightening||Delegated authority of commercial banks to provide foreign exchange without referring to Central Bank reduced.|
|South Africa||10/01/91||Liberalization||Limits on travel allowances raised.|
|09/01/92||Liberalization||Limits on allowances for travel increased further.|
|Sri Lanka||03/20/91||Liberalization||Authorized dealers permitted to release foreign exchange for all types of education abroad, except for primary school education.|
|03/27/91||Liberalization||Requirement of continuous residence for six months for eligibility of basic travel allowance withdrawn.|
|03/28/91||Liberalization||Special allowance of $600 a person permitted for pilgrimages proceeding to India and Nepal on group travel.|
|04/04/91||Liberalization||Commercial banks and authorized travel agents permitted to approve purchase of tickets for travel abroad.|
|06/14/91||Liberalization||Allowances for business and conference travel increased.|
|06/14/91||Liberalization||Annual travel allowances increased for Indian group of countries.|
|11/01/91||Liberalization||Annual tourist travel allowances increased for non-Indian group of countries.|
|03/10/92||Liberalization||Annual basic foreign exchange travel allowance to countries other than the Indian group raised.|
|03/25/92||Liberalization||Authorized dealers permitted to provide foreign exchange for primary education abroad and allowances for all students living abroad.|
|03/29/92||Liberalization||Restrictions on payments for invisibles eliminated in respect of travel, education expenses overseas, and remittances for other miscellaneous purposes. Permission granted to authorized dealers to issue international credit cards and effect such payments.|
|Swaziland||09/15/92||Liberalization||Limits on foreign exchange authorized banks are permitted to sell increased.|
|Tunisia||01/29/91||Liberalization||Authorized dealers allowed to grant foreign exchange allocations for mission and training expenses abroad.|
|08/09/91||Liberalization||Transfers for educational expenses abroad increased.|
|11/08/91||Liberalization||Foreign exchange allowances for Tunisians traveling abroad for business increased.|
|01/06/93||Liberalization||Foreign exchange allowances for Tunisians traveling abroad for tourist, business, or study purposes increased. Central Bank grants approval for all bona fide exchange applications for purpose of tourist travel, educational expenses, and business travel in excess of specified limits.|
|Turkey||11/20/92||Liberalization||Residents allowed to use credit cards on a revolving basis for travel and expenses abroad.|
|Viet Nam||09/15/92||Liberalization||Foreign exchange allocation for travel abroad raised.|
|Zambia||06/19/92||Liberalization||Documentation requirements for purchases of foreign exchange for business travel streamlined, and requirement of prior approval from Bank of Zambia eliminated for certain travel.|
|12/01/92||Liberalization||Restrictions on the purchase of foreign exchange from foreign exchange market for medical treatment lifted.|
|Zimbabwe||12/01/91||Liberalization||Basic foreign exchange allowance for holiday and business travel increased.|
|12/29/92||Liberalization||Foreign exchange allowance for medical treatment increased.|
|Outward Transfers or Payments for Services Rendered by Nonresidents|
|Bangladesh||07/01/92||Liberalization||Authorized banks permitted to remit technical fees and royalties without prior approval from Bangladesh Bank.|
|Botswana||12/01/91||Liberalization||(1) Period during which temporary residents allowed to remit their earnings abroad extended to 36 months or period of employment, whichever is shorter; (2) maximum amount of foreign exchange authorized dealers allowed to sell to temporary resident contractual workers without reference to Bank of Botswana increased; (3) amount of foreign exchange authorized dealers permitted to sell to self-employed temporary residents as part of their annual remittable allowance out of eligible income without reference to Bank of Botswana increased; and (4) authorized dealers empowered to approve, without reference to the Bank of Botswana, applications for remittance of unutilized balances of remittable allowance of self-employed temporary residents or temporary resident contractual workers.|
|01/03/92||Liberalization||Limit on remittances of dividends abolished.|
|01/03/92||Liberalization||Limit on transfers, dividends, and profits to nonresidents without referring to Bank of Botswana abolished.|
|Brazil||01/01/91||Liberalization||Central Bank allows private sector and nonfinancial public sector access to foreign exchange for purpose of servicing debts, including those owed to nonresident banks.|
|04/18/91||Liberalization||Remittance abroad of profits and dividends on investments still in process of registration in Central Bank of Brazil allowed.|
|Burundi||08/01/91||Liberalization||Limit on transfer abroad of salaries by foreign nationals increased. Returns on foreign capital and profits allocated to foreign directors allowed 10 be freely transferred abroad.|
|11/04/92||Liberalization||Foreign workers permitted to transfer abroad up to 70 percent of their net annual income.|
|Chile||05/29/92||Liberalization||Applications for advance remittances of profits earned on foreign investments under Chapter XIX of Chilean Compendium of Rules on International Exchange allowed until April 30, 1993.|
|Colombia||01/09/91||Liberalization||Eighty-day waiting period requirement for redemption of exchange certificates for transfers and service payments abolished.|
|01/28/91||Liberalization||Limit on profits foreign investors registered with Bank of the Republic allowed to transfer abroad raised to 100 percent of value of registered capital.|
|Equatorial Guinea||12/01/91||Liberalization||New regulation governing remittances by expatriate workers introduced.|
|Fiji||12/01/92||Liberalization||With prior approval from Reserve Bank: (1) nonresident-owned companies allowed to remit current year’s profits and two years’ retained earnings that had not previously been remitted; (2) emigrants allowed to transfer full amount of current year’s dividends and profits earned on assets left in Fiji.|
|12/01/92||Liberalization||Prior approval from Reserve Bank not required to make following payments if accompanied by supporting documentary proof: (1) medical treatment; (2) wage payments by shipping companies to foreign crew members, up to F$20,000; (3) advertising fees, up to F$10,000; and (4) payments of charges for movie film rental and news services.|
|Greece||01/01/92||Liberalization||Transfers abroad of profits earned on investments undertaken by residents of countries that are not EU members and after-lax rental income from real estate located in Greece and owned by individuals or legal entities permanently residing abroad liberalized.|
|01/28/92||Liberalization||Transfer abroad of profits from investments undertaken in Greece by residents of countries that are not EU members permitted without restriction.|
|07/22/92||Liberalization||All remaining restrictions on current payments and transfers eliminated.|
|Hungary||12/23/91||Liberalization||Certain institutions free to pay for membership and participation fees at conferences, including travel and hotel expenses.|
|India||04/23/91||Tightening||Clearance by Reserve Bank required for payments that exceed the equivalent of Rs 25 million to any person residing outside India except for repayments of balances in nonresident foreign currency accounts, nonresident external rupee accounts, and interbank transactions.|
|Israel||05/01/91||Liberalization||External loans allowed to be prepaid at any time after six months.|
|11/28/91||Liberalization||Limit on amounts that Israeli residents, while in Israel, may pay for imports using credit cards increased.|
|Jamaica||09/25/91||Liberalization||Limits on remittances of dividends and profits, transfers abroad for family maintenance purposes, and foreign exchange allowance for personal and business travel eliminated.|
|Morocco||01/10/91||Liberalization||Maximum limit on wages and salaries foreign employees are permitted to transfer abroad increased.|
|08/02/91||Liberalization||Foreign spouses of Moroccans permitted to transfer up to the equivalent of DH 5,000 a year.|
|01/17/92||Liberalization||Commercial banks authorized to transfer abroad net earnings of foreign airline companies.|
|03/25/92||Liberalization||Purchase of insurance policies abroad for imports financed with external funds under contracts that stipulate such purchases permitted.|
|05/05/92||Liberalization||Moroccan film distribution companies authorized to remit abroad through banking system, without prior approval, cinematographic royalties and incidental costs in favor of foreign film producers and distributors.|
|08/27/92||Liberalization||Moroccan enterprises authorized to enter freely into technical assistance contracts with foreign partners and to remit relevant user fees without prior authorization of Exchange Office.|
|10/23/92||Liberalization||Authorized banks allowed to transfer abroad insurance and reinsurance operations on behalf of nonresidents.|
|11/13/92||Liberalization||Authorized banks allowed to transfer abroad payments due on various current operations.|
|11/27/92||Liberalization||Authorized banks allowed to make all payments due with respect to sea transportation on behalf of shipowners, consignees, and maritime agents.|
|12/08/92||Liberalization||Road transportation companies, consignees, and forwarding agents authorized, without restriction, to transfer funds for expenditures related to international road transportation.|
|12/24/92||Liberalization||Authorized banks allowed to transfer pensions paid by public or private agencies in favor of retired persons residing abroad permanently.|
|Nepal||03/08/92||Liberalization||Restrictions on payments for most invisibles abolished.|
|Pakistan||02/11/91||Liberalization||Requirement of prior approval for remitting profits by certain branches of foreign companies other than banks and those engaged in insurance, shipping, and airline businesses abolished.|
|Papua New Guinea||08/01/91||Tightening||Remittance overseas of premiums on all insurance policies of permanent residents covering risks in Papua New Guinea allowed, with approval from the Commissioner of Insurance.|
|11/20/92||Liberalization||Authorized foreign exchange dealers allowed to approve invisible payments and transfers for amounts up to the equivalent of K 500,000 a year per resident for any purpose.|
|Peru||03/12/91||Liberalization||Insurance companies permitted to enter freely into reinsurance agreements with foreign and domestic companies.|
|Philippines||08/24/92||Liberalization||Authorized banks permitted to sell foreign exchange without prior approval from Central Bank for any payment on foreign exchange transactions, except for those related to external loans.|
|Romania||05/13/91||Liberalization||Persons residing in Romania permitted to lake out of the country foreign exchange or to transfer it abroad through banks for current account transactions. All economic agents allowed to transfer abroad foreign exchange purchased with lei through authorized commercial banks for current account transactions; transfers exceeding the equivulent of $10,000 require prior authorization.|
|11/11/91||Liberalization||Limits on transfers of profits removed.|
|Spain||02/01/92||Liberalization||All restrictions on payments for invisibles abolished.|
|Sri Lanka||03/20/91||Liberalization||Commercial hanks authorized to remit consultancy, licensing, royalty, and management fees to foreign firms and individuals in terms of their agreements with local companies.|
|Sudan||01/01/92||Liberalization||Schedule of minimum annual transfers to Sudan by expatriate laborers, civil servants, professionals, professors and experts, and businessmen working abroad abolished.|
|04/12/92||Tightening||Airline companies prohibited from selling their tickets in Sudan in foreign currency, except to certain individuals.|
|06/18/92||Liberalization||Airline companies permitted to sell tickets and freight services in foreign currency in Sudan only to specified categories of foreigners; airline companies permitted to receive payments for tickets and freight services in foreign currency on condition that payments be made in the form of deposits to their closed foreign currency accounts; transfers of foreign exchange deposited in closed foreign currency accounts to company’s head office abroad permitted with the approval of the Civil Aviation Authority.|
|Sweden||01/01/91||Liberalization||Residents allowed to purchase life insurance policies abroad without restriction.|
|Tunisia||01/06/93||Liberalization||Private enterprises allowed to make service payments in foreign exchange through approved intermediaries.|
|01/06/93||Liberalization||Prior approval from Central Bank for payments of living allowances and retirement pensions for residents in countries that base reciprocal arrangements with Tunisia eliminated.|
|Zambia||06/19/92||Liberalization||Requirement of prior approval from Bank of Zambia eliminated for a wide range of service payments, up to maximum of $500 a transaction.|
|Import and Export of Foreign and Domestic Currency and Notes and Holdings of Foreign Currency Domestically|
|Algeria||04/01/91||Liberalization||Requirement that nonresident Algerian nationals and foreigners must convert foreign exchange on arrival in Algeria abolished.|
|Bangladesh||06/13/91||Liberalization||Upper limit on foreign exchange that may he brought into Bangladesh without declaration at time of arrival increased.|
|China||12/01/91||Liberalization||Chinese citizens and permanent foreign residents permitted to sell their foreign exchange remitted from abroad, foreign currency deposits in Chinese banks, or foreign currency bank notes to designated banks.|
|Colombia||01/09/91||Liberalization||Surrender of foreign exchange receipts from tourism, labor contracts abroad, and donations of up to $20,000 abolished.|
|05/31/91||Tightening||Three percent lax imposed on foreign exchange receipts from personal services.|
|former Czech and Slovak Federal Republic||01/01/91||Liberalization||Obligatory conversion of minimum amount of foreign exchange by tourists abolished.|
|Egypt||02/27/91||Liberalization||Amount of Egyptian bank notes that could be taken out of country increased.|
|05/27/92||Liberalization||Regulation governing amount of foreign exchange travelers may lake out abolished.|
|El Salvador||03/01/92||Liberalization||Restriction on amount of foreign currency travelers can lake out eliminated.|
|03/01/92||Liberalization||Exchange houses authorized to purchase proceeds from invisibles.|
|Guinea||01/02/92||Tightening||Proceeds from foreign bank notes subjected to surrender requirement of 20 percent.|
|06/08/92||Liberalization||Twenty percent surrender requirement on proceeds from foreign bank notes abolished and replaced by a fee of 1.5 percent on transfers of foreign bank notes to Central Bank.|
|Guyana||09/01/92||Liberalization||Requirement that nonresidents must pay their hotel expenses in foreign currency abolished.|
|Hungary||08/01/92||Liberalization||Limits on exports and imports of forint bank notes raised.|
|India||03/24/92||Liberalization||Authorized dealers permitted to sell foreign exchange to officials, other than chief executives, of companies, up to $2.000 a person for each business trip, to enable them to meet their entertainment expenses.|
|Iraq||07/07/92||Tightening||Importation of Iraqi bank notes by travelers limited.|
|Israel||05/01/91||Liberalization||Nonresidents allowed to buy back foreign currency convened into new sheqalim during visit to Israel.|
|05/12/91||Liberalization||Inward transfers of persons visiting occupied territories liberalized; transfers exceeding $2,000 must be declared.|
|Jamaica||09/25/91||Liberalization||Requirement that tourists must pay their hotel hills and certain other expenses in Jamaica dollars abolished. Resident travelers no longer required to sell their holdings of foreign currencies to authorized dealers upon return.|
|Jordan||03/31/92||Liberalization||Amount of Jordanian bank notes and coins residents and nonresidents are permitted to take abroad increased.|
|11/08/92||Liberalization||Annual amount of foreign exchange that can be taken out or transferred abroad by residents and nonresidents increased.|
|Kenya||11/11/91||Liberalization||Requirement that visitors or returning residents must declare foreign currency in their possession abolished.|
|Namibia||06/01/91||Liberalization||Maximum amount of South African Reserve Bank notes allowed to be brought in from countries outside Common Monetary Area increased.|
|Nepal||09/10/91||Tightening||Minimum amount of foreign exchange non-Indian tourists are required to spend daily increased.|
|Pakistan||06/08/91||Liberalization||Limit on foreign exchange that resident Pakistani nationals may hold abroad increased.|
|Philippines||07/29/91||Liberalization||Tourist and nonresident visitors allowed to take out full amount of foreign exchange they brought in.|
|01/03/92||Liberalization||Mandatory surrender requirement eliminated for most earnings from services, but retained for 15 types of services.|
|08/24/92||Liberalization||Residents of the Philippines no longer required to sell foreign exchange receipts to authorized banks, and foreign exchange receipts allowed to be deposited in foreign currency accounts in the Philippines or abroad.|
|08/24/92||Liberalization||Departing tourists allowed to reconvert at airports or other ports of exit unspent pesos up to maximum of $200 or equivalent amount in other foreign exchange without proof of conversion.|
|St. Vincent and the Grenadines||01/01/93||Liberalization||One percent tax on exportation of domestic bank notes abolished.|
|Sierra Leone||12/01/91||Liberalization||Requirement that all incoming travelers declare their foreign exchange holdings abolished.|
|10/09/92||Liberalization||Nonresident travelers allowed to take out any amount of foreign currency notes they declared on arrival.|
|Spain||02/01/92||Tightening||Exportation of bank notes, coins, gold, and other means of payment in excess of the equivalent of Ptas 1 million subject to declaration, and exportation of amounts exceeding the equivalent of Plus 5 million require authorization.|
|Sri Lanka||03/27/91||Liberalization||Resident Sri Lankans permitted to bring in unlimited amounts of nonconvertible currencies on arrival in Sri Lanka, subject to declaration to customs, and to import and export in person foreign currency up to $5.000 or its equivalent in other designated currencies, without declaration to customs.|
|05/02/91||Liberalization||Foreigners arriving in Sri Lanka permitted to bring in foreign currency up to the equivalent of $5,000 without declaration to customs.|
|03/19/92||Liberalization||Resident and nonresident Sri Lankan nationals permitted to export in person foreign currencies up to the equivalent of $5,000 without declaration to customs.|
|03/25/92||Liberalization||Resident and nonresident Sri Lankan nationals permitted to import in person foreign currencies equivalent to $5.000 without declaration to customs.|
|Sudan||02/27/92||Liberalization||Shipping agencies permitted to accept foreign currency in payment for any service, but required to sell all of their foreign currency proceeds to authorized banks at unified exchange rate one day after receipt.|
|06/06/92||Liberalization||Sudanese and foreign travelers allowed to leave country with unlimited amount of foreign exchange.|
|06/06/92||Liberalization||Requirement to register foreign currency on customs declaration upon entry to Sudan abolished; Sudanese and foreign travelers allowed to enter (and leave) country with unlimited amount of foreign exchange.|
|Swaziland||01/02/92||Liberalization||Limit on amount of traveler’s checks denominated in units of account of the Preferential Trade Area for Eastern and Southern African Stales (UAPTAs) travelers to the Preferential Trade Area (PTA) are allowed to purchase abolished.|
|Syrian Arab Republic||12/19/91||Liberalization||Residents traveling abroad, other than to Jordan and Lebanon, allowed to take with them foreign exchange up to $2,000 a trip: travelers to Jordan and Lebanon allowed to lake with them up to LS 5,000 a trip.|
|12/19/91||Tightening||Nonresidents entering Syrian Arab Republic required to declare foreign exchange in their possession if amount exceeds $5,000.|
|Yemen, Republic of||08/01/91||Tightening||Non-Yemeni nationals required to pay hotel bills in foreign currency.|
|11/01/91||Tightening||Payment of airline tickets by non-Yemeni nationals required in foreign currency.|
|Zaïre||08/19/91||Liberalization||Exportation of Zaïrian bank notes and coins by residents and nonresidents permitted without authorization of Bank of Zaïre, within limits. Resident and nonresident travelers leaving country permitted to have in their possession an unlimited amount of foreign currency.|
|08/19/91||Liberalization||Importation of Zaïrian bank notes and coins by residents and nonresidents permitted up to the equivalent of $100 without authorization of Bank of Zaïre.|
|Zambia||06/19/92||Liberalization||Limit on amount of Zamhian currency that may be brought into Zambia increased to the equivalent of $100 at retention market rate: and currency declaration form previously required of all travelers entering Zambia eliminated.|
|12/01/92||Liberalization||Surrender requirement for foreign currency remittances from abroad for embassies, other diplomatic missions, and international organizations abolished; these funds allowed to be sold to commercial banks or foreign exchange bureaus at the market rate.|
|Zimbabwe||12/20/91||Liberalization||Maximum amount of Zimbabwean currency travelers leaving Zimbabwe can take out as part of their travel allowance increased to Z$150, and corresponding amount in foreign bank notes increased to the equivalent of Z$150.|
|12/20/91||Liberalization||Maximum amount of Zimbabwean currency that travelers can bring in increased.|
|12/29/92||Liberalization||Amount of Zimbabwean currency notes departing travelers can take out increased.|
|12/29/92||Liberalization||Amount of Zimbabwean currency notes arriving travelers can bring in further increased.|
|Commercial Banks’ International Transactions|
|Australia||04/19/91||Liberalization||Government announced relaxation of restrictions on borrowings in the Australian capital market by foreign governments, their agencies, and international organizations.|
|05/21/92||Liberalization||Reserve Bank began considering applications from foreign banks seeking authorization for branches and subsidiaries. All foreign corporations seeking authorization to conduct banking business in Australia must satisfy Reserve Bank of their willingness and capacity to adhere to high standards of prudential management. Foreign bank branches not to be required to maintain “endowed capital” in Australia and. consequently, Reserve Bank would not impose any capital-based large exposure limits.|
|Austria||11/04/91||Liberalization||All foreign exchange controls abolished.|
|Bangladesh||02/26/91||Liberalization||Upper limit on borrowing by foreign-owned or -controlled manufacturing companies incorporated in Bangladesh on the domestic capital market removed.|
|06/15/91||Liberalization||Requirement to obtain permission from Bangladesh Bank to issue and transfer shares in favor of nonresidents against foreign investment in industrial ventures in Bangladesh waived, except for the requirement to meet certain procedural formalities.|
|06/14/92 and 07/18/92||Liberalization||Authorized banks permitted (1) to lend to foreign-owned and -controlled industrial firms operating in Bangladesh without prior approval from Bangladesh Bank, and (2) to transfer savings of expatriates, at the time of completion of employment in Bangladesh, provided their salaries and benefits were initially certified by the Board of Investment.|
|Brazil||09/25/91||Liberalization||Borrowing abroad for financing of agricultural development permitted.|
|04/01/92||Tightening||Limit on authorized banks’ sold position in foreign exchange markets reduced by relating it to net foreign assets position of each institution.|
|05/18/92||Liberalization||Depository receipts authorized to be issued abroad by depository institutions with backing in securities held in specific custody in Brazil.|
|Chile||06/05/91||Tightening||Reserve requirement of 20 percent was imposed on all new foreign borrowing, except for credits that are provided directly to Chilean exporters by foreign importers.|
|06/20/91||Liberalization||Credits granted by foreign commercial banks to Chilean commercial banks as part of restructuring packages exempted from the 20 percent reserve requirement.|
|06/27/91||Liberalization||An alternative means of satisfying the 20 percent reserve requirement on new foreign borrowing in the form of a special repurchase agreement with the Central Bank established.|
|07/11/91||Tightening||Twenty percent reserve requirement extended to existing credits, except for credits with maturity of less than six mouths; requirement on existing credits maturing between July 11 and December 31, however, would be phased out.|
|05/29/92||Tightening||Reserve requirement on foreign currency deposits at commercial banks increased to 30 percent from 20 percent.|
|05/29/92||Liberalization||Commercial banks authorized to sell foreign exchange, using their term deposits in foreign exchange.|
|07/14/92||Liberalization||Exchange arbitrage operations undertaken abroad by banks liberalized: commercial banks authorized to increase their foreign exchange exposure and sell their excess holdings to banks other than the Central Bank.|
|Colombia||06/24/91||Liberalization||Central Bank transferred to commercial banks and financial corporations all direct foreign exchange transactions with the private sector. The intermediaries were required to hold a minimum net foreign position of 20 percent of their capital.|
|10/09/91||Tightening||Minimum net foreign exchange position of commercial banks and financial institutions increased to 30 percent.|
|04/30/92||Tightening||Minimum net foreign exchange position of commercial banks and financial corporations increased to 45 percent.|
|Costa Rica||03/01/92||Liberalization||All controls on capital transactions eliminated.|
|Cyprus||07/03/92||Liberalization||List of customers to whom loans or other credit facilities in foreign currency may be issued by banks further widened.|
|12/15/92||Liberalization||Amount that may be released annually from blocked accounts for transfer abroad increased from £C 5,000 to £C 10,000, effective January 1, 1993.|
|Egypt||02/26/91||Liberalization||Import accounts in foreign exchange abolished.|
|El Salvador||08/01/91||Liberalization||Capital transactions liberalized.|
|Finland||01/01/91||Liberalization||All remaining foreign exchange controls, except those relating to contracting of loans abroad by private individuals and comparable corporate entities abolished.|
|10/01/91||Liberalization||Exchange controls on contracting of loans abroad by private individuals and comparable corporate entities abolished.|
|Gambia, The||11/30/92||Liberalization||Exchange Control Act, suspended in 1986, repealed in the context of a revised Central Bank Act that liberalized capital controls.|
|Ghana||05/17/91||Tightening||Net open foreign exchange positions of ail authorized foreign exchange dealers (which included some nonbank foreign exchange bureaus) subjected to limits.|
|Greece||06/17/92||Liberalization||Credit institutions established in Greece allowed to lend to individuals permanently residing abroad with their own resources or with borrowing in foreign exchange for acquisition of real estate in Greece.|
|Grenada||03/15/91||Liberalization||All restrictions on transfers of Eastern Caribbean dollars from Grenada to countries served by the Eastern Caribbean Central Bank eliminated.|
|Guinea||01/02/91||Tightening||Commercial banks required to surrender 20 percent of foreign exchange they have purchased from die public to the Central Bank.|
|Honduras||06/18/92||Liberalization||Commercial banks authorized to purchase and sell foreign exchange at freely negotiated exchange rates; the percentage of foreign exchange to be transferred from commercial banks to the Central Bank reduced to 30 percent from 40 percent.|
|Iceland||01/01/92||Liberalization||Annual limit on funds that may be re-lent or on credits that may be extended by a resident financial institution to any resident was raised from ISK 5.625 million to ISK 7.500 million or its equivalent in other currencies. Annual limits on the following types of investment by residents were raised: (1) direct investments abroad and the purchase of real estate abroad, from ISK 5.625 million in ISK 7.500 million or its equivalent in other currencies; (2) portfolio investments abroad, from ISK 562.000 to ISK 750,000 or its equivalent in other currencies; and (3) investments in mutual funds in foreign exchange by members of the Icelandic Securities Exchange, from ISK 112.5 million to ISK 150 million.|
|India||03/17/92||Liberalization||Limit of Rs 50 million a transaction for authorized dealers abolished; all restrictions on use of foreign currency loans and credit lines with financial institutions for the purpose of financing capital goods imports, including the limit on foreign currency loans by banks, abolished.|
|03/27/92||Liberalization||Authorized dealers permitted to offer forward cover for all transactions permitted under exchange control regulations.|
|Indonesia||03/01/91||Tightening||Limits on banks’ net open position in foreign currency and on their outstanding stock of swaps reduced from 25 percent to 20 percent of capital. Bank Indonesia ceased to accept swaps with one-month or shorter maturities.|
|10/10/91||Tightening||Annual ceilings announced for commercial borrowings over the next five years, with suhceilings for individual sectors.|
|11/01/91||Tightening||Banks were required to keep the net open position in foreign currency including their off-balance-sheet accounts at or below 20 percent of capital; the swap faculty was modified, with Bank Indonesia relinquishing obligation to accept swaps with maturities of less than two years.|
|11/05/91||Liberalization||Bank Indonesia limited banks’ short-term foreign exchange liabilities (up to two years, excluding trade-related financing) to 30 percent of capital, and required that at least 80 percent of all foreign exchange loans be allocated to businesses earning foreign exchange.|
|Italy||05/12/91||Liberalization||Reserve requirement on the increase in net foreign currency deposits by residents abolished.|
|10/23/92||Liberalization||Reserve requirement on lira-denominated interbank deposits held by nonresident banks with Italian banks abolished.|
|Jamaica||05/13/91||Liberalization||Rate of commercial banks’ surrender requirement of foreign exchange to Bank of Jamaica reduced from 50 percent to 40 percent.|
|09/25/91||Liberalization||All inward and outward capital transfers permuted, with the exception that financial institutions (such as life insurance companies, commercial banks, merchant banks, trust companies, finance houses, building societies, unit trusts, pension funds, credit unions, and other organizations that are repositories for domestic financial savings) must match their Jamaica dollar liabilities to their clients with Jamaica dollar assets.|
|08/06/92||Tightening||Authorized foreign exchange dealers began to sell voluntarily to Bank of Jamaica 5 percent of their daily purchases of foreign exchange. Each authorized dealer entitled to buy back up to 50 percent of the amount it had sold, with a monthly limit of one-third of the amount of its sales.|
|Jordan||03/18/91||Liberalization||Authorized banks and financial companies allowed to extend credit facilities to residents and nonresidents against their foreign currency deposits up to JD 100,000 without the prior approval of the Bank of Jordan. Credits exceeding JD 100,000 may also be extended without prior approval, provided they are folly hacked by deposits in foreign currency.|
|07/23/91||Tightening||A reserve ratio of 15 percent imposed on offshore banks belonging to Jordanian banks and financial companies.|
|Korea||07/01/91||Liberalization||Required ratio of overbought foreign exchange position of foreign exchange banks was reduced to 1 percent from 2 percent of preceding month’s average total value of foreign exchange bought.|
|07/01/91||Liberalization||Documentation requirements for foreign exchange transactions between a foreign exchange bank and a nonbank customer (both spot and forward) liberalized.|
|09/01/92||Liberalization||Regulations on forward exchange transactions liberalized as follows: (1) transactions of less than $1 million exempted from documentation requirements, provided they are declared and conform to “real demand” principle, and transactions of between $1 million and $3 million would require documentation only after the fact; (2) branches of foreign insurance companies allowed to engage in forward foreign exchange transactions up to limit of their capital base (as in the case of branches Of foreign banks and securities firms); and (3) transactions related to investment of foreign funds in Korean stocks permitted.|
|09/01/92||Liberalization||Foreign exchange used to hedge exchange risk on capital transactions exempted from limit on overall overbought position; limit on the overall oversold position was raised to 20 percent of the average outstanding amount of foreign exchange bought in previous month or $10 million (previously $5 million), whichever is greater; oversold position for spot transactions allowed, with a limit of 5 percent of” average outstanding amount of foreign exchange bought in previous month or $5 million, whichever is greater.|
|Malaysia||04/20/92||Tightening||Total borrowing by residents in foreign currency from domestic commercial banks and merchant hanks to finance imports of goods and services restricted to the equivalent of RM 1 million (previously there were no limits); total borrowing by residents in foreign currency from domestic sources to pay interest or repay principal on loans in foreign currency obtained previously from a licensed bank subjected to same limit (previously there were no limits).|
|10/24/92||Tightening||Offshore guarantees obtained by residents to secure domestic borrowing, except offshore guarantees (whether denominated in ringgit or in foreign currency) without recourse to Malaysian residents and obtained from the licensed offshore banks in Labuan to secure domestic borrowing would be deemed as foreign borrowing; in cases where an offshore guarantee is denominated in ringgit, it would be subject to condition that, in the event the guarantee is called on, licensed offshore banks in Labuan must make payments in foreign currency (except the currencies of Israel. South Africa, and the Federal Republic of Yugoslavia (Serbia and Montenegro)) rather than in ringgit.|
|Mauritius||07/01/91||Liberalization||Domestic banks allowed to hold foreign currency balances of companies operating in Mauritius with offshore banks in Mauritius, and the placement of such funds abroad or in offshore banks exempted from the payment of 15 percent transfer tax.|
|Morocco||05/22/91||Liberalization||Authorized hanks empowered to issue international credit cards to Moroccan nationals holding convertible dirham accounts.|
|Paraguay||12/20/91||Tightening||Banks required to maintain a daily net position in foreign exchange equivalent to no more than 50 percent of their capital and reserves.|
|Peru||03/13/91||Liberalization||Restrictions on transfers abroad of foreign exchange by the private sector eliminated. Banks permitted to transfer funds for domestic residents to establish foreign exchange deposits overseas and to make financial and nonfinancial investments. Restrictions on frozen foreign currency deposits in domestic banking system lifted.|
|03/22/91||Liberalization||Blocked deposits at the Central Bank established for purposes of servicing private sector debts permitted to be withdrawn.|
|04/25/91||Liberalization||Legal framework for the domestic financial industry revised, whereby foreign investments in the banking, financial, and insurance sectors would be treated on the same basis as domestic investments.|
|12/02/91||Liberalization||Requirements established in 1983 prohibiting the servicing of working capital loans were abrogated, and banks were permitted to withdraw up to $12 million of deposited proceeds from the Central Bank.|
|Philippines||01/28/91||Tightening||Limits placed on the foreign exchange position of commercial banks, In general, banks required to maintain a balanced position, with the excess of assets over liabilities (“overbought” position) being limited to the average of hanks’ negotiated letters of credit for the immediately preceding three months.|
|02/22/91||Liberalization||Allowable overbought position increased. Banks’ foreign assets allowed to exceed liabilities by as much as their average monthly payments for merchandise imports and invisibles. Cumulative net overbought (oversold) positions must be reported daily and settled weekly.|
|02/27/91||Liberalization||Exporters allowed to avail themselves of U.S. dollar loans from a local commercial bank to meet their peso or foreign exchange requirements.|
|03/04/91||Tightening||Forward purchases without any corresponding foreign exchange obligation excluded from consideration as part of a bank’s foreign exchange assets; cash letter of credit collateralized with confirming banks would be included under foreign exchange liabilities.|
|04/20/91||Tightening||Banks’ oversold position limited to $500,000.|
|04/20/91||Tightening||Additional guidelines covering peso-blocking requirements on foreign loans subject to Paris Club Rescheduling issued.|
|06/14/91||Tightening||Regulations governing commercial banks’ permissible open foreign exchange positions promulgated. Banks’ long foreign exchange positions may not exceed 25 percent of their unimpaired capital, while their short foreign exchange positions may not exceed 15 percent of such capital.|
|01/30/92||Liberalization||Authorized banks permitted to sell foreign exchange for repatriation of all types of investments without prior approval from Central Bank.|
|01/30/92||Liberalization||Commercial banks allowed to maintain open foreign exchange positions, subject to certain limits. Their long and short foreign exchange positions may not exceed 25 percent and 15 percent, respectively, of their unimpaired capital.|
|06/22/92||Liberalization||Foreign exchange payments for principal, interest, fees, and related charges on foreign credit approved by and registered with Central Hank and not subject to or covered by rescheduling with foreign creditors allowed to be remitted through authorized banks without prior approval from the Central Bank.|
|07/10/92||Tightening||Administrative sanctions imposed on banks violating net open foreign exchange position limits.|
|08/21/92||Liberalization||Revised policy guidelines on short-term foreign currency loans promulgated, and banks allowed to extend the following short-term foreign currency loans without prior approval from Central Bank: (1) normal interbank transactions; (2) borrowings by commodity and service exporters; and (3) borrowings by resident depositors against their own deposits, subject to certain conditions.|
|Portugal||11/26/92||Liberalization||Contracting of short-term financial credits from abroad liberalized.|
|12/16/92||Liberalization||Restrictions on forward purchases from, or sales of, escudos to nonresidents not directly associated with trade in goods and services or for authorized capital transfers abolished.|
|12/16/92||Liberalization||Foreign exchange operations between nonbank residents and nonresidents permuted (with effect from January 1, 1993); short-term lending in escudos to nonresidents permitted.|
|Sierra Leone||09/10/92||Liberalization||Amount of deposit required to operate a foreign exchange bureau reduced to $5,000 from $25,000.|
|Slovenia||04/01/92||Liberalization||The ratios of foreign exchange deposits that deposit money banks are required to hold abroad as cover against domestically held foreign exchange deposits changed to 5–90 percent, depending on maturity of deposits.|
|04/24/92||Liberalization||Commercial banks allowed to extend foreign exchange credits to resident juridical persons.|
|07/05/92||Liberalization||Forward exchange transactions allowed.|
|Solomon Islands||01/20/91||Tightening||Maximum allowable foreign currency position of authorized dealers at the close of each business day was reduced to SI$250,000.|
|01/20/92||Liberalization||The delegated authority of authorized foreign currency dealers to provide foreign exchange without referring to the Central Bank was reduced to SI$25,000 a transaction. SI$5,000 a customer a week, and SI$25,000 a customer a year. However, on February 18, 1993, the limit on individual transactions was raised to SI$25,000. These limits would also apply to the use of credit card accounts. Authorized foreign currency dealers are required to notify the Central Bank of all inward foreign currency transactions exceeding SI$ 100.000 a day.|
|01/20/92||Tightening||Foreign exchange position the commercial banks are allowed to hold at close of each business day reduced to SI$250,000.|
|Spain||09/24/92||Tightening||A compulsory one-year, non-interest-bearing deposit to be held at Bank of Spain introduced against increments from the September 22 level of long positions taken against pesetas in foreign exchange markets and in peseta-denominated lending to nonresidents; the reserve requirement ratio on increases in peseta-denominated liabilities of domestic credit entities (national or foreign) with their branches, subsidiaries, or parent companies abroad raised to 100 percent.|
|10/05/92||Liberalization||Measure introduced on September 24 abolished, and replaced by a compulsory non-interest-bearing deposit, to be held by commercial and savings banks or with Bank of Spain, against increase in peseta lending to nonresidents through swaps on foreign exchange markets.|
|11/24/92||Liberalization||Measure introduced on October 5 abolished.|
|Sri Lanka||03/29/93||Liberalization||Authorized dealers permitted to enter into forward exchange contracts for up to 360 days irrespective of the purpose.|
|Sweden||01/01/92||Liberalization||Requirement that all capital transactions must be conducted through authorized currency traders abolished.|
|Tonga||07/01/92||Tightening||A tax of 0.7 percent levied on all foreign exchange transactions.|
|11/17/92||Liberalization||The 0.7 percent foreign exchange tax introduced in July was abolished.|
|Trinidad and Tobago||04/13/93||Liberalization||All exchange controls relating to capital and current account transactions eliminated.|
|Turkey||06/20/91||Liberalization||Residents in Turkey permitted to freely sell abroad securities issued by companies in Turkey; banks allowed to extend foreign exchange credits to other banks without maturity restriction; residents in Turkey allowed to issue sureties and guarantees in foreign currency: the minimum capital requirement for companies authorized to conduct foreign exchange transactions raised to TL 2 billion; and banks and foreign exchange dealers required to notify authorities within 30 days of any transfers in excess of $50,000 or its equivalent that are unrelated to foreign trade or invisible transactions.|
|04/01/92||Liberalization||Liquidity ratio of foreign currency-denominated assets to the foreign currency liabilities applied to banks lowered to 16 percent from 20 percent.|
|11/20/92||Liberalization||Liquidity ratio for financial institutions with respect to foreign exchange liabilities reduced to 10 percent from 20 percent; and the exchange rate risk ratios of foreign currency-denominated assets to foreign currency liabilities applied to banks reduced by 5 percentage points in respect of each category of liabilities.|
|Zaïre||08/19/91||Liberalization||Exchange bureaus must open accounts with approved commercial banks, and foreign exchange in excess of $50,000 held by individuals or $100.000 held by corporations in these accounts for more than five working days must be exchanged for zaïres. Cash holdings in foreign exchange by exchange bureaus may not exceed $10,000 for individuals or $50.000 for corporations.|
|Nonresidents’ Accounts and Residents’ Foreign Exchange Accounts|
|Algeria||02/20/91||Liberalization||Juridical and natural persons of foreign nationality authorized to open foreign exchange accounts in a convertible currency of their choice, with limits on permissible debits and credits.|
|Angola||04/03/92||Liberalization||Nonresidents permitted to hold accounts in new kwanzas under certain conditions, subject to prior authorization from central bank.|
|08/12/92||Liberalization||Resident enterprises authorized to open foreign currency accounts with domestic institutions.|
|Argentina||12/01/92||Liberalization||Current account deposits in U.S. dollars permitted Reserve requirement allowed to be met partially in foreign or domestic currency, and same reserve requirement ratio would apply to foreign and domestic currency deposits. Banks and other authorized intermediaries allowed to extend credits in local currency against current account deposits in U.S. dollars and other foreign exchange resources, except those in a savings bank or a fixed-term account, up to 25 percent of their capital, subject to regulations governing their net overall foreign exchange position (effective early 1993).|
|Bangladesh||06/13/91||Liberalization||Time limit for maintaining Nonresident Foreign Currency Deposit (NFCD) accounts by Bangladeshi nationals on their permanent return to Bangladesh increased to five years from one; Bangladesh Bank may consider request for further extension of the lime limit in cases of necessity. Those returning Bangladeshi nationals may maintain foreign currency accounts/NFCD accounts/education foreign currency accounts for six months from the dale of their return with foreign exchange they brought in with them provided they did not maintain foreign currency accounts during their stay abroad.|
|05/15/91||Liberalization||Resident Bangladeshis allowed to open and maintain foreign currency accounts with foreign exchange brought into Bangladesh at the lime of their return from travel abroad. Amounts that are declared and amounts up to $2.500 dial are not declared to the customs authority would be allowed to be credited to these accounts. Crediting of proceeds from exports of goods or services or commissions earned on businesses in Bangladesh to these accounts would not be allowed. These accounts may he maintained for up to five years from the date of deposit. Interest payments would be allowed on a prescribed minimum balance.|
|Colombia||01/09/91||Liberalization||Colombian residents authorized to maintain assets and earned income abroad, provided that they owned assets before September 1. 1990 or acquired them from exchange receipts that do not have to be surrendered.|
|00/24/91||Liberalization||Residents of Colombia authorized to open foreign exchange accounts abroad and were granted six months to legalize foreign exchange accounts held abroad through payments of a 3 percent tax amnesty on the amount held abroad: after June 26, the rate of tax payment to be raised to 5 percent.|
|Cyprus||03/01/91||Liberalization||Central Bank delegated authority to authorized dealers to open and operate foreign currency accounts in the name of resident manufacturers; exporters may deposit up to 50 percent of export proceeds in these accounts and use balances to pay for imports of raw materials used in production; account holders would be required to convert into Cyprus pounds at the end of each year any balances they had not used to pay for imports.|
|05/31/91||Liberalization||Central Bank delegated authority to authorized dealers to open and operate foreign currency accounts in the name of residents who are engaged in transit trade.|
|09/03/92||Liberalization||Central Bank delegated authority to authorized dealers to open and operate foreign currency accounts in the name of resident hoteliers, who may deposit in these accounts part of their earnings in foreign currency and use balances to repay foreign currency loans.|
|Dominican Republic||04/12/92||Liberalization||Financial institutions authorized to accept savings and time deposits in foreign currency.|
|Greece||01/02/92||Liberalization||Interest on sight deposits in convertible drachma accounts allowed to be negotiated between banks and account holders.|
|01/28/92||Liberalization||All restrictions on withdrawals and payments abroad from blocked accounts of funds derived from rents and pensions abolished.|
|08/07/92||Liberalization||Residents of Greece allowed to open and maintain deposit accounts in foreign exchange with bank notes without reporting the sources of acquisition. Principal and interest earned on these accounts may be withdrawn in foreign bank notes or drachmas but may not be transferred abroad.|
|Grenada||07/15/91||Liberalization||Sales of foreign exchange repatriated by Grenadians living abroad exempted from the foreign exchange tax.|
|Hungary||07/01/92||Liberalization||Resident and nonresident exporters allowed to accept domestic currency, and nonresident holders of such proceeds allowed to open foreign trade forint accounts; balances in these accounts may not be converted into foreign exchange but may be used by residents to pay for goods bought in Hungary or for their living expenses while staying in Hungary.|
|Iceland||01/01/92||Liberalization||Residents who have lawfully acquired foreign exchange permitted to maintain accounts with up to ISK 3,75 million with nonresident institutions (the previous limit was ISK 1.5 million).|
|01/01/92||Liberalization||Limits on deposits in foreign banks by domestic entities increased to ISK 3,75 million from ISK 1.5 million; amount that domestic entities are authorized to borrow abroad increased to ISK 7.5 million from ISK 5,625 million. (These limits abolished at the beginning of 1993.)|
|India||02/28/92||Liberalization||Authorization given for (1) foreign currency-denominated accounts; (2) nonresident rupee accounts for purposes of operating securities investment; (3) transfers of balances between foreign currency accounts and the rupee accounts; and (4) transfers abroad of repatriated capital, capital gains, dividends, and interest income.|
|06/04/92||Liberalization||Nonresident rupee nonrepatriable deposit scheme introduced to encourage foreign investment Under this scheme, accounts may be opened by nonresident Indian nationals, overseas corporate bodies predominantly owned by nonresident Indian nationals, and foreign citizens of non-Indian origin (except Pakistani and Bangladeshi nationals).|
|06/04/92||Liberalization||Residents allowed to hold up to $500 in foreign currencies for numismatic purposes.|
|09/22/92||Liberalization||The Resident Foreign Currency Account Scheme replaced the Returning Indians Foreign Exchange Entitlement Scheme. Under this scheme. Indian nationals permanently returning to India from abroad would be permitted, within three months of their arrival, to open and operate resident foreign currency accounts in any permitted currency with authorized dealers in India: all foreign exchange transferred from abroad may he credited to these accounts.|
|Iraq||09/19/92||Liberalization||Residents and nonresidents of Iraqi nationality allowed to open foreign currency accounts at the commercial banks and to use the balances in these accounts without restriction, provided the accounts have been credited with foreign bank notes.|
|Ireland||06/01/91||Liberalization||Resident individuals permitted to operate personal foreign currency accounts with financial institutions in Ireland, subject to following conditions: (1) deposits made with funds converted from Irish pounds must be for fixed terms of at least three months; (2) withdrawals in foreign currency would be permitted only when payment is to be made either to an approved agent or to a nonresident for permitted purposes; and (3) checking facilities would not be permitted. The deposit interest retention tax that applied to domestic deposits is also extended to cover foreign currency deposits.|
|01/01/92||Liberalization||Nonresidents allowed to maintain deposits in Irish pounds without restriction. Restriction that residents may only hold foreign deposit currency accounts in Ireland of a fixed term of longer than three months was abolished.|
|Israel||05/01/91||Liberalization||Regulations governing the use of funds in certain foreign currency accounts with Israeli banks were simplified.|
|01/30/92||Liberalization||Nonresidents’ eligibility to hold nonresident local currency accounts convertible at Israeli banks.|
|01/30/92||Liberalization||Nonresidents permitted to maintain convertible domestic currency accounts at authorized banks.|
|07/01/92||Liberalization||All residents permitted to open and maintain foreign currency deposit accounts (previously only the business sector was allowed to operate these accounts).|
|Jamaica||09/25/91||Liberalization||Residents and nonresidents allowed to maintain foreign currency accounts with domestic banking system or abroad. All balances held in “A” accounts by residents as of September 20, 1991 would continue to be eligible for privileges under the account, namely tax-free interest and freedom to use the funds for any purpose, but residents prohibited from opening new “A” accounts or from making new deposits in such accounts. Residents and nonresidents continued to be allowed to hold “B” accounts. However, resident accounts restricted to certificates of deposit with a minimum maturity of one year, and withdrawal before the end of the one-year period would nullify tax-free status. However, residents permitted to hold foreign exchange in any other form or account.|
|09/25/91||Liberalization||Opening of nonresident external accounts in Jamaica dollars would no longer require specific approval of Bank of Jamaica.|
|09/25/91||Liberalization||Requirement that all payments from abroad to Jamaican hoteliers must be paid into a special account of the Bank of Jamaica abolished.|
|Jordan||08/06/91||Liberalization||Maximum balance residents are permitted to hold in foreign currency accounts with authorized banks and financial companies increased.|
|Kenya||06/17/91||Liberalization||Enterprises operating in export promotion zone permitted to hold foreign currency accounts abroad or with authorized banks in Kenya and to open external accounts in Kenya shillings with an authorized bank.|
|Korea||07/01/91||Liberalization||Documentation requirements for foreign currency deposits in nonresident accounts were liberalized, and firms whose annual external transactions exceed $10 million were exempted from documentation requirements for foreign currency deposits of up to 10 percent of the amount of their annual foreign currency transactions (up to a limit of $100 million).|
|09/16/91||Liberalization||Residents permitted to carry out all current transactions in Korean won, provided that settlements would be made in designated foreign currencies.|
|09/16/91||Liberalization||Korean subsidiaries abroad permitted to obtain offshore financing without prior approval of their prime credit bank for loans amounting to up to $5 million.|
|12/18/91||Liberalization||Prohibition on sales of foreign currencies from accounts for purposes of making domestic payments abolished. Nonresidents not required to obtain approval from the Bank of Korea to convert more than the equivalent of $50,000 in foreign exchange into won.|
|09/01/92||Liberalization||Ceiling on foreign currency deposits maintained by resident firms (which is based on the amount of external transactions) increased to 10 percent; companies with records of external transactions exempted from documentation requirements irrespective of amount of annual transactions.|
|Kuwait||03/24/91||Tightening||Limit of KD 4.000 a month placed on withdrawals from accounts at local banks to transfer into foreign currency. Exemptions to this limit allowed for import payments, interest payments or other foreign obligations, profit transfers of foreign companies, transfers of the diplomatic community, and medical and educational expenses. This control would expire at the end of June 1991.|
|07/01/91||Liberalization||Limit on withdrawals and transfers from local hanks raised to KD 6,000 from KD 4,000 a month. Exemptions to this limit remained unchanged.|
|08/03/91||Liberalization||All limits on withdrawals and transfers from local banks abolished.|
|Mauritius||07/01/92||Liberalization||Tax applicable to capital transfers by residents and nonresidents reduced to 5 percent from 15 percent All foreign investors became eligible to repatriate capital, including capital gains, without prior approval from Bank of Mauritius and payment of a 5 percent tax.|
|Morocco||03/29/91||Liberalization||Exporters of goods and services allowed to open and maintain convertible dirham accounts and to keep 20 percent and 10 percent respectively, of their earnings in these accounts to cover promotional and representational expenses abroad.|
|01/24/92||Liberalization||Blocking of funds belonging to the capital accounts of nonresident foreigners abolished; these accounts replaced with convertible term accounts, and transfers of funds out of these accounts would be allowed after three years.|
|Myanmar||10/13/91||Liberalization||Transfers of balances between foreign currency account holders permitted with approval.|
|Nepal||12/01/91||Liberalization||Regulations governing foreign currency deposits liberalized to include deposits in Swiss francs, deutsche mark, and Japanese yen. in addition, eligibility requirements for Nepalese residents to open foreign currency accounts liberalized.|
|Pakistan||02/13/91||Liberalization||Residents of Pakistan allowed to open and maintain foreign currency accounts with banks in Pakistan on the same basis as nonresidents. Such accounts may be funded by remittances from abroad, traveler’s checks, foreign currency notes, and certain other proceeds. No questions would be asked regarding the sources of acquisition of foreign exchange. Receipts from exports of goods and services, earnings of overseas branches of companies resident in Pakistan, and foreign exchange released from Pakistan for any specified purpose may not be credited to foreign currency accounts. Balances held in such accounts freely transferable abroad, and there are no limits on amount of withdrawal.|
|08/29/91||Liberalization||Resident firms and companies, including investment banks, permitted to maintain foreign currency accounts.|
|08/31/91||Liberalization||Pakistani and foreign nationals residing abroad and visiting Pakistan for short periods allowed to operate their nonresident accounts in Pakistan freely during their stay.|
|Papua Now Guinea||11/20/92||Liberalization||Regulations governing overseas borrowing by residents liberalized. Under the new regulations, authority to approve new foreign currency borrowing of up to a maximum amount of K 5 million equivalent for a resident delegated to authorized foreign exchange dealers, and maximum debt to equity ratio for borrowers was raised to 5:1 from 3:1.|
|Peru||03/11/91||Liberalization||Interest rates for foreign exchange deposits and loans from the domestic banking system freed.|
|03/27/91||Liberalization||Natural and juridical persons residing in the country permitted to hold and dispose of foreign exchange without restriction, both domestically and abroad.|
|Portugal||12/31/91||Liberalization||Opening of interest-bearing foreign currency accounts at the domestic banks liberalized.|
|09/01/92||Liberalization||(1) Contracting of medium- and long-term financial credits from abroad was liberalized: and (2) compulsory deposit requirement against deposits in foreign currency abolished, and the existing balances maintained at the Banco de Portugal were released.|
|12/16/92||Liberalization||Following transactions permuted freely: (1) opening of interest-bearing escudo deposits by nonresidents (and the elimination of the corresponding reserve requirement against such deposits), and (2) demand and term deposits abroad by residents.|
|Romania||11/11/91||Tightening||Juridical persons with state-owned or privately owned capital no longer permitted to maintain or to open foreign currency accounts with commercial banks.|
|06/08/92||Liberalization||Exporters allowed to retain 100 percent of receipts in foreign currency accounts with domestic banks.|
|Sierra Leone||11/05/91||Liberalization||Restrictions on the use of foreign currency accounts for current transactions removed. Deposits to, and withdrawals from, these accounts for current transactions were permitted without prior approval from central bank.|
|Sri Lanka||01/09/91||Liberalization||Commercial banks permitted to open nonresident foreign currency accounts for Sri Lankan and foreign nationals.|
|03/20/91||Liberalization||Nonresident foreign currency account holders permitted to invest funds in approved enterprises and to credit to foreign currency accounts profits and dividends earned and sale proceeds of such investments received in foreign currency.|
|04/02/91||Liberalization||Funds in blocked accounts of nonresident foreign citizens and foreign companies, excluding Sri Lankan citizens who have emigrated or acquired foreign citizenship, and Indian and Pakistan’s repatriates, permitted to be repatriated in foreign currency.|
|08/01/91||Liberalization||Residents of Sri Lanka permitted to open resident foreign currency accounts subject to a minimum balance of $500 or equivalent in other designated currencies, without prior approval and without documentary evidence of customs clearance.|
|12/12/91||Liberalization||Rupee loan facilities for third parties against nonresident foreign currency balances were permitted.|
|03/29/92||Liberalization||Export proceeds permitted to be credited to resident foreign currency accounts that do not qualify for tax exemption or amnesty in the domestic banking units of commercial banks.|
|06/30/92||Liberalization||All funds from the nonresident accounts of nonresident Sri Lankans who emigrated and acquired foreign citizenship, or who acquired permanent resident status abroad and had their nonresident accounts blocked for five or more years as of June 30, 1992, allowed to be withdrawn.|
|Sudan||02/03/92||Tightening||Most transfers between foreign currency accounts within country prohibited.|
|02/09/92||Liberalization||Following transfers between foreign exchange accounts within country permitted: (1) transfers from specified institutions (Arab Organization for Agricultural Development, Arab Bank for Economic Development in Africa. Arab Authority for Investment and Agricultural Development. Arab Sugar Association, Khartoum International Institute for Arabic Language. Arab Center for Social Security, international organizations, embassies, and foreign companies) to their employees; (2) deposits to and withdrawals from the Duly-Free Shops Corporation accounts; and (3) transfers from accounts of airline companies.|
|02/26/92||Liberalization||Transfers between foreign exchange accounts within country temporarily permitted until May 30, 1992 if these accounts were owned by those who have commercial investment authorizations for which banking procedures have been completed.|
|02/27/92||Tightening||Authorized banks required to close foreign currency accounts of shipping agencies and prohibited from issuing bank checks payable to the Duty-Free Shops Corporation against foreign currency accounts owned by individuals.|
|03/17/92||Liberalization||Authorized banks permitted to open special foreign currency accounts in foreign currency and local currency for specified bodies, including diplomatic and foreign missions and organizations, international and regional organizations, voluntary and charitable foreign organizations, foreign companies and branches of foreign companies, foreign contractors and subcontractors, and for employees of these organizations; these accounts may be credited with transfers from abroad for the organizations’ accounts and with salaries for their employees’ accounts, and they may he debited for transfers abroad, withdrawals for the purpose of travel by the account holder or his family, and local payments in Sudanese pounds, provided foreign exchange is converted at the unified exchange rate. Special local currency accounts of organizations may he credited with transfers from their special foreign currency accounts or with checks issued by government bodies; special local currency accounts of employees may be credited with transfers from their special foreign currency accounts.|
|03/29/92||Liberalization||Authorized banks allowed to issue bank checks payable to Duty-Free Shops Corporation against foreign currency accounts owned by individuals from whom corporation requires payment for purchases of automobiles that it has imported on their behalf after obtaining the consent of the Ministry of Commerce. Corporation, and Supply.|
|05/12/92||Tightening||Authorized banks required to close foreign currency accounts of airline companies and to keep balances in closed foreign currency accounts; Use of balances from these accounts would be granted only with respect to transfers to the headquarters of the airline companies abroad with approval from Bank of Sudan. Airline companies allowed to open current accounts with any authorized bank for purpose of keeping their revenues with approval from Bank of Sudan; these accounts may be debited to meet local expenditures. Airline companies required to open “closed local currency accounts,” which were to be credited with the net revenues from sales every three months after obtaining approval from Bank of Sudan. These accounts may be debited with (1) transfers to the company’s headquarters abroad, (2) withdrawals to meet local commitments with approval from Bank of Sudan, and (3) payments of transit and landing fees for scheduled flights to Sudan after approval from the Civil Aviation Authority.|
|05/20/92||Liberalization||Authorized banks allowed, until May 31, 1992, to issue bank checks payable to the Duty-Free Shops Corporation against foreign currency accounts owned by individuals and companies.|
|06/01/92||Tightening||Authorized banks prohibited from issuing bank checks payable to the Duty-Free Shops Corporation against foreign currency accounts owned by individuals.|
|06/06/92||Liberalization||Restrictions on use of free foreign exchange accounts were liberalized. Requirement to declare sources of foreign exchange used to replenish free foreign exchange accounts held by Sudanese nationals with domestic banks abolished. Free foreign exchange accounts thus allowed to be credited with any means of payment without submitting any documents. Withdrawals in cash in foreign currency from these accounts exceeding $5,000 (or its equivalent) would be subject to a fee of one Sudanese pound per $1.|
|06/18/92||Liberalization||Airline companies allowed to open foreign currency accounts without the consent of Bank of Sudan.|
|07/04/92||Liberalization||Withdrawals from special accounts in the form of traveler’s or cashier’s checks or cash to finance travel expenses of account holders and their immediate family members allowed without restriction.|
|Trinidad and Tobago||04/01/92||Liberalization||Designated exporters permitted to retain all of their eligible export earnings in foreign currency accounts (previously, 20 percent of such earnings required to be surrendered to the commercial banks).|
|Turkey||06/20/91||Liberalization||Nonresidents allowed to purchase foreign exchange from banks and other authorized dealers in Turkey and transfer it abroad without limitation. Nonresidents were also allowed to transfer Turkish liras abroad through banks and authorized institutions without limitation.|
|Viet Nam||05/01/91||Introduction||Foreign currency savings account facility for households was introduced. Accounts would offer interest rates of 9.6 percent a year on time deposits and 6 percent a year on sight deposits.|
|Algeria||02/24/91||Liberalization||Algerian banks began to offer three-year, interest-free bonds in dinars, which entitle the subscriber to exchange 20 percent of the placement value annually into a convertible currency at the official exchange rate.|
|Australia||07/25/91||Liberalization||Foreign investors may acquire any residential real estate within a designated Integrated Tourism Resort without the need to obtain approval under the foreign investment guidelines. Foreign investment regulations amended accordingly.|
|Botswana||11/02/92||Liberalization||(1) Nonresident-controlled companies permitted to invest in securities of companies listed in the Botswana Share Market with funds not originating from a nonresident source; (2) maximum limit for aggregate portfolio investments by nonresidents and nonresident-controlled companies (including their nominees) increased to 49 percent from 25 percent of the “free stock” (defined as total stock issued and paid up less stock held by direct investors); and (3) as a result of the changes in (2) above, eligibility of nonresident-controlled companies to borrow locally would be determined by applying the debt-to-equity limitation after deducting company’s internal portfolio holding from equity.|
|Brazil||02/08/91||Liberalization||Criteria for conversion of debt into equity for the private sector debt with maturities beginning 1991 announced.|
|03/02/91||Liberalization||Conversion of external debt instruments of the federal public sector, bonds, and deposits denominated in foreign currency for use in the national privatization program authorized.|
|05/31/91||Liberalization||Access to stock market by foreign institutional investors liberalized by exempting profits from income taxes; these investments to be exempted from the capital gains tax, but to be subject to a 15 percent tax from the income that would be collected at the time of remittance abroad.|
|06/01/91||Liberalization||Issuance of debentures that are convertible into stocks in domestic enterprises authorized.|
|07/16791||Liberalization||Facility for externally funded nonprofit organizations to undertake debt for nature swaps was introduced, with an initial limit on the total amount of $100 million.|
|03/12/92||Liberalization||Central Bank announced that, in order to be eligible for tax exemptions, minimum average maturity of foreign funding obtained through issuance of securities must be 30 months.|
|04/23/92||Liberalization||Central Bank announced (1) that it would permit companies to arrange foreign funding through issuance of foreign debt instruments (such as Eurobonds and commercial paper) only if minimum maturity is 30 months; and (2) that, in order to benefit from lax exemptions, average period of amortization must be at least 60 months.|
|04/30/92||Liberalization||Resident private sector companies and selected public sector companies authorized to hedge against changes in international interest rates.|
|06/30/92||Liberalization||Foreign investors represented by funds, investment companies, and institutional investor authorized to operate in options and futures markets related to securities, exchange, and interest rates.|
|Central Bank authorized corporations established in Brazil to issue and place abroad securities that can be converted into equities.|
|Issues and placement of securities that can be converted into stocks by companies and institutions headquartered in Brazil allowed, subject to prior authorization from Central Bank.|
|07/16/92||Liberalization||Foreign investors represented by funds, investment companies, and institutional investors authorized to operate in options and futures markets related to securities, exchange, and interest rates.|
|10/01/92||Liberalization||Central Bank authorized corporations established in Brazil to issue and place abroad securities that can be converted into equities.|
|Issues and placement of securities that can be converted into stocks by companies and institutions headquartered in Brazil allowed, subject to prior authorization from Central Bank.|
|10/14/92||Liberalization||Private nonfinancial Brazilian residents authorized to invest abroad up to $1 million without prior authorization; for investments in excess of $1 million, Brazilian investors must provide information to the Central Bank, which will authorize the transaction within 30 days.|
|10/29/92||Liberalization||Minimum maturity of external debt contracted under Resolution No. 63 and Law No. 4131, other than bonds, notes, and commercial paper, lengthened to 30 months from 1 year.|
|Chile||05/13/92||Liberalization||A-rated Chilean enterprises and banks authorized to issue bonds in foreign markets.|
|05/29/92||Liberalization||(1) Pension funds authorized to invest abroad up to 1.5 percent of total value of pension fund; (2) period of application of the reserve requirement on external credits entering under Chapter XIV increased to 1 year from 90 days, but reserve requirement ratio for these capital inflows left unchanged at 20 percent until August 18.|
|08/18/92||Liberalization||Reserve requirement on external credits entering under Chapter XIV increased to 30 percent from 20 percent.|
|10/01/92||Tightening||Limit on investment that pension funds are allowed to undertake abroad increased to 3 percent of total value of pension fund from 1.5 percent.|
|China||09/26/91||Introduction||“Regulations on Borrowing Overseas of Commercial Loans by Resident Institutions” and “Rules on Foreign Exchange Guarantee by Resident Institutions in China” issued.|
|Colombia||01/09/91||Liberalization||Eighty-five percent advance deposit requirement for all capital transfers abroad abolished.|
|01/15/92||Liberalization||Requirement to maintain the investments made in mutual funds for at least one year was abolished. In addition. Colombian residents were allowed to hold foreign stocks and other portfolio investments abroad.|
|02/05/92||Liberalization||Minimum maturity on foreign loans contracted by private Colombian individuals or firms reduced to one year from five years, and limit on contractual interest rates (2.5 percent over LIBOR) eliminated for private sector.|
|El Salvador||08/01/91||Liberalization||Capital transactions liberalized.|
|Finland||01/01/92||Liberalization||Foreign private individuals, foreign corporate entities, and Finnish corporate entities owned by nonresidents permitted to own shares in Finnish investment trusts.|
|Greece||05/01/91||Liberalization||Greek residents permitted to invest freely in securities and real estate in other EU markets.|
|06/11/92||Liberalization||Residents of Greece allowed to acquire dividends, bonds, and shares issued by legal entities established in non-EU member countries under the same terms and conditions as those applied in EU member countries.|
|Iceland||01/01/92||Liberalization||Annual limit on funds that may be re-lent or on credits that may be extended by resident financial institution to any resident raised from ISK 5.625 million to ISK 7.500 million or its equivalent in other currencies. Annual limit on portfolio investments abroad by residents raised from ISK 562,000 to ISK 750,000 or its equivalent in other currencies; annual limit on investment in mutual funds in foreign exchange by members of the Icelandic Securities Exchange raised from ISK 112.5 million to ISK 150 million.|
|01/01/93||Liberalization||All restrictions on long-term borrowing abroad by residents and long-term lending by residents to nonresidents removed.|
|India||02/28/92||Liberalization||Foreign institutional investors, including institutions (for example, pension funds, mutual funds, investment trusts, asset management companies, nominee companies, and incorporated or institutional portfolio managers) permitted to make investments in all securities traded on the primary and secondary markets, including equity and other securities or instruments of companies listed on the stock exchange in India: they are required to register initially with the Securities Exchange Board of India and with the Reserve Bank.|
|Ireland||01/01/91||Liberalization||A number of regulations pertaining to transactions with non-EU residents relaxed as follows: (1) the limit on outward direct investment that may be made by conversion of Irish pounds into foreign exchange increased to 50 percent from 25 percent of total investment; (2) the upper limit of £Ir 50,000 on purchases of personal property for personal use outside the EU removed; and (3) all restrictions on the amount of transfers that may be made 10 residents of non-EU countries removed, although prior reference to the Central Bank required (transfers exceeding £Ir 20,000, however, must be referred to the Central Bank for statistical purposes). Investments by residents in foreign securities were liberalized as follows: (1) residents would be permitted to purchase with domestic currency foreign UC1TS (Undertaking for Collective Investment in Transferable Securities), which are registered under the EU UCITS Coordination Directive; (2) resident persons would be permitted to purchase foreign securities with an original maturity of less than two years with domestic currency up to a maximum limit of £Ir 10.000 an individual and up to a total of £Ir 50 million during 1991; and (3) resident persons would be permitted to purchase futures and options in foreign securities through an approved agent for hedging purposes. All forms of lending to nonresidents permitted, provided the maturity is longer than five years.|
|01/01/92||Liberalization||Residents permitted to (1) purchase (through approved agents) foreign securities issued on a foreign market without restriction; (2) to lend in domestic currency with maturities of more than one year to nonresidents without restriction; (3) to borrow in foreign currency for nontrade purposes without restriction; and (4) to guarantee loans to nonresidents on behalf of Irish residents or nonresidents without restriction and to purchase or sell commodity future contracts. Companies registered with the International Financial Services Center were allowed to convert their capital from Irish pounds to a foreign currency on a onetime basis.|
|Israel||01/30/92||Liberalization||(1) Proceeds from sales of bonds and mutual funds originally purchased with foreign currency by nonresidents permitted to be converted into foreign currency; and (2) nonresidents permitted to borrow in domestic currency from authorized banks against foreign currency collateral.|
|01/30/92||Liberalization||(1) Resident individuals permitted to invest in a wide range of foreign-traded securities (recognized foreign securities), provided that the securities purchased are held in a safekeeping deposit with an authorized dealer; and (2) individuals were allowed to engage in financial options trading (previously such transactions were permitted only for risk-hedging purposes).|
|Kenya||10/01/91||Liberalization||A system of foreign exchange bearer certificates (FEBCs) introduced. Residents and nonresidents may use convertible foreign exchange to purchase FEBCs, which are denominated in U.S. dollars with denominations ranging from $500 to $10,000, without revealing the source of funds they used to purchase them.|
|Korea||01/01/92||Liberalization||Foreign investors permitted to invest in domestic stock market, provided that foreign ownership of listed firms does not exceed 10 percent of total equity and that individual foreign investors do not hold more than 3 percent of total equity.|
|07/01/92||Liberalization||Investments in stocks by resident foreign financial institutions subjected to same limits as those by institutions owned by nationals. Resident foreign financial institutions allowed to undertake over-the-counter transactions in listed bonds|
|09/01/92||Liberalization||Limit on investments in securities, insurance, and investment trust companies raised to $50 million from $10 million, and limit on similar investments by companies with international business licenses and insurance companies with assets of over W 5 trillion raised to $100 million from $50 million.|
|Malta||01/01/93||Liberalization||Ten percent tax levied on portfolio investments abroad by residents abolished.|
|Pakistan||02/07/91||Liberalization||Investments by foreign nationals in shares of industries were made repatriable.|
|04/22/91||Liberalization||To supplement the existing FEBC scheme. U.S. dollar bearer certificates introduced, which allow asset holders to hold a one-year maturity instrument denominated in U.S. dollars.|
|Philippines||01/03/91||Liberalization||Regulations governing commercial banks’ permissible open foreign exchange positions promulgated. Banks’ long foreign exchange positions may not exceed 25 percent of their unimpaired capital, while their short foreign exchange positions may not exceed 15 percent of such capital.|
|08/24/92||Liberalization||Investors allowed to purchase up to $1 million a year in foreign exchange from banking system for investments abroad without prior approval from Central Bank; all limits on repatriation of capital from foreign direct equity investments removed; foreign banks permitted to grant short-term foreign currency loans to eligible borrowers without prior approval from Central Bank, and commercial banks allowed to extend both short- and long-term foreign currency loans without prior approval from Central Bank.|
|10/23/92||Liberalization||Policies, rules, and regulations governing medium- and long-term loans obtained by residents from foreign creditors and local banks consolidated as follows: (1) negotiations of public sector loans would require prior approval from Central Bank; (2) negotiations of private sector loans would require prior approval from Central Bank, and residents must register the purpose of these loans with Central Bank in order to service them with foreign exchange purchased from authorized agent banks; (3) private sector loans to finance projects must cover up to 50 percent of the local cost components; and (4) medium- and long-term loans must he made at interest rate prevailing in international capital markets.|
|Portugal||06/14/91||Liberalization||All foreign direct investments and investments in real estate abroad by residents liberalized, as was the acquisition of foreign shares not quoted in stock exchange. However, residents must channel such investments through a resident bank by establishing custody accounts. Banks required to withhold taxes as necessary and to verify payment of all taxes.|
|07/05/91||Tightening||Purchase by nonresidents of indexed-coupon securities in escudos whenever interest rate adjustments were effected at intervals of less than one year and purchase of shares in mutual funds specializing in such securities was subject to prior authorization from die Banco de Portugal; restriction would remain in effect until December 31, 1991.|
|01/01/92||Tightening||Restriction on purchases by nonresidents of indexed-coupon securities, which have been subject to prior authorization from the Banco de Portugal, extended to April 30, 1992.|
|11/01/92||Liberalization||Ban on purchases by nonresidents of floating-rate securities in escudos for which interest adjustments were effected at intervals of less than one year was lifted.|
|12/16/92||Liberalization||Residents permitted to acquire money market instruments.|
|Sri Lanka||05/08/91||Liberalization||Companies incorporated abroad permitted to invest in securities traded at the Colombo Stock Exchange, subject to the same terms and conditions as those applicable to such investments by approved national funds, approved regional funds, and nonresident individuals, including Sri Lankans residing abroad.|
|06/29/92||Liberalization||Purchase of securities issued by companies incorporated in Sri Lanka was permitted through Share Investment External Rupee Accounts, with certain conditions and limitations.|
|Sweden||01/01/92||Liberalization||Requirements that foreign securities must be purchased or sold through a securities trading institution or a currency trader that has special approval from the Riksbank and that foreign securities must be deposited with a currency trader or through a currency trader that has special approval from the Riksbank abolished.|
|12/31/92||Liberalization||Prohibition on depositing funds in accounts with foreign banks or transacting through these accounts abolished.|
|Trinidad and Tobago||04/01/91||Liberalization||Cross-border trading permitted among the residents of Barbados, Jamaica, and Trinidad and Tobago of purchases and sales of shares of companies listed on the respective stock exchanges.|
|Turkey||06/20/91||Liberalization||Residents of Turkey permitted to sell freely abroad securities issued by companies in Turkey; banks allowed to extend foreign exchange credits to other banks without restriction on maturity; residents of Turkey allowed 10 issue sureties and guarantees in foreign currency; the minimum capital requirement for companies authorized to conduct foreign exchange transactions raised to TL 2 billion; and banks and foreign exchange dealers required to notify authorities within 30 days of any transfers in excess of $50,000 or its equivalent that are unrelated to foreign trade or invisible transactions.|
|Venezuela||04/10/91||Liberalization||Regime for convening external public debt into equity investment amended.|
|09/28/92||Tightening||Regulation providing for conversion of certain external public debts into equity came into effect.|
|Aruba||01/03/92||Liberalization||Resident natural persons permitted to purchase officially listed foreign securities up to the equivalent of Af. 100,000 a year, provided that funds borrowed on the domestic capital market are not used for these purchases.|
|Botswana||12/01/91||Liberalization||Nonresident-controlled companies in Botswana allowed to invest their funds in pula that were generated in the country as well as those from external sources in any securities issued by the Bank of Botswana.|
|Brazil||01/01/92||Liberalization||Maximum withholding lax rate set at 25 percent, for remittances of profits and dividends earned abroad, irrespective of their relationship to registered capital base; basic rate may be lowered if companies remitting abroad furnish proof that comparable tax rates in their home countries are lower.|
|01/09/92||Liberalization||Participation by foreigners in privatization process liberalized. Period that investments relating to privatization financed through foreign debt instruments are required to remain in Brazil reduced to 6 years from 12 years. Minimum holding period of two years before assets acquired in the process of privatization can be sold to invest in other assets in Brazil abolished.|
|09/30/92||Tightening||Leasing contracts covering goods and real estate authorized to be made for a minimum term of two years; to benefit from total tax exemption, term must be at least five years.|
|Chile||10/14/91||Liberalization||Under Chapter XIX, after paying a fee to the Central Bank, foreign investors allowed to sell their investments to domestic residents.|
|China||04/09/91||Liberalization||Law concerning the income lax on foreign-funded enterprises and foreign enterprises unifies tax rates for Chinese foreign equity joint ventures. Chinese foreign contractual joint ventures, and wholly owned foreign enterprises.|
|03/01/92||Liberalization||A large number of inland and border areas opened to foreign investments.|
|Colombia||01/09/91||Liberalization||New foreign direct investments would receive the same tax treatment as domestic investments, but the tax on profit and income remittances would continue to be levied.|
|Greece||05/01/91||Liberalization||Greek residents permitted to invest freely in securities and real estate in other EU markets.|
|06/11/92||Liberalization||Residents of Greece allowed to invest in real estate located in non-EU member countries under the same terms and conditions as those applied to real estate investments in EU member countries.|
|Guinea-Bissau||09/30/91||Liberalization||Applications for foreign direct investment simplified.|
|Honduras||06/20/92||Liberalization||Repatriation of capital and remittances of dividends and profits unrestricted.|
|Hungary||01/01/91||Liberalization||Licensing requirement for joint ventures abolished.|
|Iceland||03/25/91||Liberalization||Nonresidents would be free to make investments in Iceland, subject to the conditions laid down in general legislation governing foreign investment or, as the case may be, in sector-specific legislation.|
|03/25/91||Tightening||Regulations governing foreign direct investments modified as follows: (1) only resident Icelandic citizens or domestically registered companies wholly owned by resident Icelandic citizens may fish within the Icelandic fishing limit or operate primary fish processing; (2) only Icelandic state and local authorities, resident Icelandic citizens, or domestically registered Icelandic companies wholly owned by resident Icelandic citizens may acquire the right to harness waterfalls and geothermic energy (the same restrictions may apply to power production and distribution companies); (3) investment by nonresidents in domestic airlines would be restricted to 49 percent; (4) investment by nonresidents in domestic incorporated commercial banks would be restricted to 25 percent, but foreign commercial banks allowed to open branches in Iceland as of January 1, 1992; (5) total investment by a single nonresident or by financially linked nonresidents in excess of ISK 250 million a year subjected to authorization by the Minister of Commerce. Total investment by nonresidents in any sector subjected to authorization by the Minister of Commerce; and (6) in all cases, nonresidents would be required to satisfy a reciprocity requirement to invest in Iceland.|
|01/01/91||Liberalization||Annual limit on funds that may be re-lent or on credits that may be extended by a resident financial institution to any resident was raised from ISK 5.625 million to ISK 7.500 million or its equivalent in other currencies. Annual limits on the following types of investment by residents were raised: (1) direct investments abroad and the purchase of real estate abroad, from ISK 5.625 million to ISK 7.5000 million or its equivalent in other currencies; (2) portfolio investments abroad, from ISK 562,000 to ISK 750,000 or its equivalent in other currencies; and (3) investment in mutual funds in foreign exchange by members of the Icelandic Securities Exchange, from ISK 112.5 million to ISK 150 million. Residents who have lawfully acquired foreign exchange were permitted to maintain accounts with nonresident institutions up to ISK 3.75 million (the previous limit was ISK 1.5 million).|
|01/01/92||Liberalization||Annual limit on direct investments abroad and purchase of real estate abroad by residents raised from ISK 5.625 million to ISK 7.5 million or its equivalent in other currencies.|
|01/01/93||Elimination||Ceilings on direct investments and purchases of real estate abroad abolished.|
|India||06/03/91||Liberalization||Regulations governing the activity of” firms with foreign capital equity participation exceeding 40 percent relaxed.|
|04/16/92||Liberalization||Regulations on foreign direct investments liberalized as follows: (1) foreign capital participation of up to 51 percent in high-priority industries would be given prompt approval, provided equity inflows would be sufficient to cover the foreign exchange requirement for imported capital goods; (2) dividend payments would be monitored by the Reserve Bank to ensure that dividend transfers would be balanced by export earnings over a period of time; (3) foreign equity investments would be allowed for trading companies primarily engaged in export activities; (4) other equity investments, including those involving 51 percent foreign equity that do not meet the above criterion, would continue to need prior clearance, but clearance procedures simplified; and (5) a special board would be established to negotiate with large international firms and approve foreign direct investments in selected areas.|
|Indonesia||06/03/91||Liberalization||Investment licensing requirements were liberalized. Number of activities included in the negative list reduced to 60 from 70, and another 31 activities partially deregulated by allowing licenses to be granted to domestic and foreign investors under prespecified conditions.|
|04/16/92||Liberalization||(1) Full foreign ownership of foreign direct investments by nonresidents permitted; (2) foreign direct investments with a minimum capital of $250,000 would be permitted in certain cases; and (3) foreign investors would be allowed to reinvest profits in the shares of other foreign firms.|
|Iraq||12/29/92||Liberalization||Arab nationals permitted to bring capital into Iraq in Iraqi currency for industrial and agricultural investment purposes under certain conditions; such inflows would be treated as working capital.|
|Ireland||01/01/92||Liberalization||Residents allowed to undertake financial investments and purchase properties in non-EU countries.|
|Japan||04/26/91||Liberalization||Amendment to the law governing foreign direct investment promulgated. Under the revised law, foreign investors required to report only after undertaking investment except when national security interest is involved and in four industries reserved under the Capital Movements Liberalization Code of the OECD (agriculture, forestry and fishery, milling and petroleum industry, and leather and leather products).|
|01/01/92||Liberalization||Foreign investors required to report only ex post all investments, except for those in industries involving national security (that is, aircraft, weapons, nuclear power, and space development), the four industries reserved under the Capital Movement Liberalization Code of the OECD (listed above), and leather and leather products, and those in several specified sectors.|
|Korea||01/01/91||Liberalization||Foreign direct investments permitted in ventures involving importation of alcoholic beverages wholesale.|
|03/01/91||Liberalization||A notification system introduced simplifying procedures for approval of foreign direct investment, Under the new system, applications for foreign investment, except in those industries on the negative list and in certain other categories, would be deemed approved 30 days after notification submitted, unless notification is not accepted for reasons of national security, environmental protection, or violation of antitrust or fair trade laws.|
|07/01/91||Liberalization||Restrictions on the scope of foreign direct investment in the retail sector eased, with number of retail shops per investment increased to ten from one and with maximum floor space per shop increased.|
|09/01/92||Liberalization||Regulations on direct investments abroad liberalized as follows: (1) investments of up to $5 million would require notification to, but not prior approval from, Bank of Korea (previous limit was $2 million), while investments of between $5 million and $10 million would require approval from Bank of Korea, and investments of more than $10 million would require approval from the Bank of Korea and the Deliberation Committee for Overseas Investment; (2) restrictions on investments in countries with which Korea does not have diplomatic lies eased; (3) investments in foreign joint ventures in which Korean investors own less than 20 percent of total equity would be treated as overseas direct investments, provided Korean investors establish special relationships with foreign ventures (for example, helping to appoint executives and supplying raw materials); (4) direct investments in high-technology and major resource developments would be encouraged and Heated favorably; (5) Korean firms merging with, or taking over, a foreign company would be allowed to obtain offshore financing; and (6) restrictions on local financing of Korean-owned companies relaxed.|
|Malawi||04/01/92||Tightening||Investments by non resident-controlled firms in technical and specialized service areas (for example, architecture, quantity surveying, consulting and civil engineering, and auditing and accounting) restricted.|
|Malaysia||11/01/92||Liberalization||Guidelines on foreign equity capital ownership liberalized as follows: (1) companies exporting at least 80 percent of their production no longer subject to equity requirements; (2) companies exporting between 50 percent and 79 percent of their production permitted to hold 100 percent equity, provided they have invested $50 million or more in fixed assets or completed projects with at least 50 percent local value added and company’s products do not compete with those produced by domestic firms. These guidelines would not apply to sectors in which limits on foreign equity participation have been established.|
|Mali||02/26/91||Liberalization||A new investment code introduced, simplifying procedures for foreign and domestic investors to obtain preferential treatment with regard to domestic taxes for investments that meet specific criteria on employment creation, domestic content of production, location, and value of investment.|
|Mexico||06/01/92||Liberalization||Constitutional amendment permuting foreign individuals and corporations to own land and to establish joint ventures (up to 49 percent of capital stock) with Mexican farmers.|
|Morocco||09/15/92||Liberalization||Foreign direct investments fully liberalized, and repatriation of proceeds from liquidation or sale of investments, including profits, would be permitted Without restriction.|
|Nepal||06/01/92||Liberalization||Liberalization of foreign investment regulations announced. Applications for foreign direct investment would be processed through a “one-window” system within 30 days of application, and foreign investors would be allowed to own 100 percent of capital in medium- and large-scale industries.|
|Pakistan||02/07/91||Liberalization||The requirement of government approval for issues of capital to nonresidents and central bank approval for issue and export of shares to nonresidents abolished.|
|Philippines||06/13/91||Liberalization||A new foreign investment law promulgated: number of sectors open to full foreign ownership. expanded investment approval process, and restrictions on foreign investments more clearly defined; streamlined foreign firms would be allowed to invest in all sectors, except for those on three negative lists.|
|01/03/92||Liberalization||Full and immediate repatriation privileges for all types of investments allowed to be serviced directly by authorized agent banks’ without obtaining prior approval from Central Bank.|
|Poland||07/04/91||Liberalization||Under new foreign investment law adopted, administrative procedures for establishment and taxation of new joint ventures simplified, general tax holidays eliminated, and all restrictions on transfers of profits and repatriation of capital removed.|
|Portugal||06/14/91||Liberalization||All foreign direct investments and investments in real estate abroad by residents liberalized, as well as the acquisition of foreign shares not quoted on a stock exchange. Residents must channel such investments through a resident bank by establishing custody accounts. Banks required to withhold taxes as necessary and to verify payment of all taxes.|
|01/01/92||Tightening||Restrictions on purchases by nonresidents of indexed-coupon securities, which have been subject to prior authorization from the Banco de Portugal, extended to April 30, 1992.|
|Romania||05/03/91||Introduction||Foreign investments allowed in all sectors of economy, except in areas where environment or Romania’s national security and defense interests must be protected. There are no limits on foreign equity participation in a commercial company set up in Romania, and foreign investors would be allowed to participate in management of investment operation or assign contractual rights and obligations to other Romanian or foreign investors. Foreign investors allowed to transfer abroad (1) their share of profits carried in convertible currencies or in lei: and (2) proceeds in freely convertible currencies obtained from total or partial proceeds from sale of stocks, shares, bonds, and other securities, as well as from the liquidation of investments: and the proceeds in lei obtained from the liquidation of investments in freely convertible currencies in three annual installments. Imported machinery, equipment, installations, means of transport, and other goods in kind, constituted as participation of the foreign investor, exempted from import custom duties. Foreign investors also benefit from certain tax advantages.|
|Sao Tome and Principe||10/15/92||Liberalization||A new investment code introduced, permitting foreign direct investments in alt sectors except hydrocarbons and other mining industries and repatriation of capital with authorization: annual transfers of profits would be restricted to 15 percent of invested capital.|
|Syrian Arab Republic||05/04/91||Liberalization||A new investment law aimed at encouraging all private investment in Syria, including direct foreign investment, came into force.|
|Sweden||12/31/92||Liberalization||Prohibition on depositing funds in accounts with foreign banks or transacting through these accounts abolished.|
|Tonga||07/01/91||Liberalization||Foreign investors in the manufacturing sector granted a 15-year lax holiday.|
|Viet Nam||12/23/92||Liberalization||(1) Duration of joint ventures extended to 50 years from 20 years and. exceptionally, to 70 years; (2) private Vietnamese enterprises were permitted to join foreign joint ventures; and (3) foreign joint ventures in priority sectors exempted from the profit lax (which ranges from 15 percent to 25 percent) during the first two years in which they are eligible and granted a 50 percent reduction of tax payments during the following two years.|
|Zimbabwe||12/29/92||Liberalization||Use of Export Retention Scheme funds extended to cover repatriation of foreign direct investments and cross-border investments. Applicants for repatriation of foreign direct investments through medium of six-year external government bonds given option to remit approved amount through the market.|
|Afghanistan, Islamic State of||Pegged Single Currency: U.S. dollar||Independently Floating||QIV91||Most convertible currency transactions effected at the freely floating commercial exchange rate.|
|Albania1||—||Pegged Currency Composite: Other||QIV91||Dual exchange rate system in effect. A “basic rate” pegged to the European Currency Unit (ECU) and a market-determined exchange rate.|
|Pegged Currency Composite: Other||Independently Floating||QII92||The official exchange rate, which had been pegged to the ECU, abolished, and the exchange rate allowed to be determined by market prices.|
|Angola||Pegged Single Currency: U.S. dollar||Other Managed Floating||QII94||Single official rate is adopted and market rates are unified. The official rate is determined in fixing sessions.|
|Argentina||Independently Floating||Pegged Single Currency: U.S. dollar||QI91||Austral linked to U.S. dollar within a band for exchange market intervention.|
|Armenia1||—||Pegged Single Currency||QIII92||The Armenian ruble is pegged to the Russian ruble.|
|Pegged Single Currency: Other||Independently Floating||QIV93||A new currency, the dram, is introduced.|
|Azerbaijan||Pegged Single Currency: Other||Independently Floating||QII94||Peg to the Russian ruble is discontinued.|
|Belarus1||—||Pegged Single Currency: Other||QIII92||Belarus introduces the rubel, which is pegged to and circulates alongside the ruble. Multiple exchange rates in effect at this time.|
|Pegged Single Currency: Other||Other Managed Floating||Q1V93||Dual exchange rate system eliminated. Unified exchange rate set twice weekly on the basis of the convertible currency auction.|
|Bulgaria||Pegged Currency Composite: Other||Independently Floating||QI91||Multiple exchange rate system replaced by a unified floating interbank exchange rate.|
|Burundi||Pegged Currency||Pegged Currency Composite: Other||QII92||The composite peg arrangement of the Burundi franc to the SDR replaced by a peg arrangement to an undisclosed basket of currencies that reflects the pattern of Burundi’s international trade.|
|Colombia||Adjusted According to a Set of Indicators||Other Managed Floating||QI94||Exchange rate managed within a preannounced band of ±7 percent. The measure unifies the dual system.|
|Costa Rica||Other Managed Floating||Independently Routing||QI92||Crawling peg system replaced by a regime under which the exchange rate is determined by market forces.|
|Croatia1||—||Other Managed Floating||QII93||The Croatian dinar is pegged to a basket of seven currencies weighted by their share in external payments and managed flexibly.|
|Other Managed Floating||Independently Floating||QIV93||In the context of a new foreign exchange law, a market-determined exchange rate arrangement is introduced.|
|Czech Republic1||—||Pegged Currency Composite; Other||QIV93||The currency of the Czech Republic is the Czech koruna, the external value of which is determined on the basis of a basket of currencies comprising the deutsche mark and the U.S. dollar.|
|Dominican Republic||Pegged Single Currency: U.S. dollar||Independently Floating||QI91||Introduction of a temporary dual exchange rate system comprising a pegged official rate and a freely floating rate in an interbank market for most transactions.|
|Estonia1||—||Pegged Currency Composite: Other||QII92||Since the introduction of a currency board system, the convertibility of the kroon has been guaranteed by the Bank of Estonia; the exchange rate of the kroon has been pegged to the deutsche mark at the rate of EEk 8 per DM 1.|
|Ethiopia||Pegged Single Currency: U.S. dollar||Independently Floating||QII93||A foreign exchange auction administered by the National Bank of Ethiopia is introduced. The official rate continues to be pegged to the U.S. dollar.|
|Finland||Pegged Currency Composite: Other||Independently Floating||QIII92||The authorities cease to peg the markka to the ECU.|
|Georgia||—||Pegged Single Currency: Other||QIII92||The currency of Georgia is the Russian ruble.|
|Pegged Single Currency: Other||Independently Floating||QIII93||Authorities make the Georgian coupon, determined by market forces, the only legal tender circulating in the country.|
|Guyana||Pegged Single Currency: U.S. dollar||Independently Floating||QI91||Official exchange rate devalued to the level prevailing in the cambio market, effectively unifying the two exchange rates, and the special exchange rate applicable to Caribbean Common Market (CARICOM) transactions abolished. Transactions in the cambio market are conducted freely.|
|Haiti||Pegged Single Currency: U.S. dollar||Independently Floating||QIII91||Dual exchange market unified by transferring all transactions effected at the official rate to the free market rate.|
|Honduras||Other Managed Floating||Independently Floating||QI92||Foreign exchange houses authorized to buy and sell foreign exchange for all transactions at freely determined exchange rates.|
|Independently Floating||Other Managed Floating||QII94||Interbank market is replaced by foreign exchange auction.|
|India||Other Managed Floating||Independently Floating||QI93||The dual exchange rate system unified, and the exchange rate of the rupee allowed to float.|
|Iran, Islamic Republic of||Pegged Currency Composite: SDR||Independently Floating||QI93||The multiple exchange rate system unified, and the exchange rate allowed to be determined by market forces.|
|Israel||Pegged Currency Composite: Other||Other Managed Floating||QIV91||Crawling exchange rate band system introduced aimed at achieving a nominal depreciation equal to the difference between the official domestic inflation target and a forecast of foreign inflation for that year.|
|Italy||Flexibility Limited||Independently Floating||QIII92||Following a devaluation of the Italian lira against other EMS currencies, the lira is withdrawn from the ERM.|
|Kazakhstan1||—||Pegged Single Currency: Other||QI93||The Russian ruble circulates as legal tender. A dual exchange rate system is in effect at the time.|
|Pegged Single Currency: Other||Independently Floating||QIV93||A new currency, the tenge, is introduced. Its exchange rate is determined weekly in foreign currency auctions.|
|Kenya||Pegged Currency Composite: Other||Independently Floating||QIV93||The dual exchange rate system is unified. All transactions take place in the interbank foreign exchange market.|
|Kyrgyz. Republic1||—||Pegged Single Currency: Other||QIII92||The currency of the Kyrgyz Republic is the Russian ruble.|
|Pegged Single Currency: Other||Independently Floating||QII93||A new national currency, the som, becomes legal tender. The som is freely floating.|
|Latvia1||—||Pegged Currency Currency: Other||QII92||The Latvian ruble is initially pegged to the Russian ruble at the rate of Latvia ruble 1 per Rub I. Both currencies circulate as legal tender.|
|Pegged Single Currency: Other||Independently Floating||QIII92||The Latvian ruble is made the only legal tender and is allowed to float.|
|Lithuania1||—||Independently Floating||QIII92||The ruble and the general purpose coupons, talonas, circulate as legal tender. A multiple exchange rate system is in effect at this time.|
|Independently Floating||Pegged Single Currency: U.S. dollar||QII94||A currency board is established.|
|Macedonia, former Yugoslav Rep. of1||—||Independently Floating||QIV93||The currency of the former Yugoslav Republic of Macedonia is the denar. The denar’s exchange rate is determined by the interplay of supply and demand in the foreign exchange market, which includes foreign exchange bureaus.|
|Madagascar||Adjusted According to a Set of Indicators||independently Floating||QII94||Interbank market is created.|
|Malawi||Pegged Currency Composite: Other||Independently Floating||QI94||A market-based exchange system is established.|
|Maldives||Independently Floating||Other Managed Floating||QIV91||The exchange rate of the rufiyaa was allowed to float broadly in line with market prices, albeit with varying degrees of periodic official intervention.|
|Marshall Islands1||—||Independently Floating||QII92||The currency of the Marshall Islands is the U.S. dollar.|
|Micronesia. Federated Slates of1||—||Pegged Single Currency: U.S. dollar||QIV93||The currency of the Federated Stales of Micronesia is the U.S. dollar.|
|Moldova||—||Pegged Single Currency; Other||QIII92||The Russian ruble circulates as legal lender in Moldova. A dual exchange rate system is abolished.|
|Pegged Single Currency: Other||Independently Floating||QIII93||Moldovan coupons, determined by market forces, become the only legal tender in Moldova. Subsequently, the Moldovan leu replaces the coupons as sole legal lender and unifies previous dual exchange market.|
|Mongolia1||—||Pegged Single Currency: U.S. dollar||QI91||Currency of Mongolia is the tugrik. The official rate is pegged to the U.S. dollar. A market rate is determined by parallel market transactions that are officially tolerated.|
|Pegged Single Currency: U.S. dollar||Independently Floating||QII93||The dual exchange rate system is unified, and the exchange rate for the turgik allowed to float.|
|Mozambique||Adjusted According to a Set of Indicators||Independently Floating||QII92||All foreign exchange transactions shifted to the secondary market where die exchange rate is market-determined.|
|Nepal||Pegged Currency Composite: Other||Independently Floating||QI93||The official and market-determined exchange rates are unified at the level of the market-determined exchange rate.|
|Independently Floating||Pegged Currency Composite: Other||QII93||The exchange rate relative to the Indian rupee is fixed.|
|Nicaragua||Other Managed Floating||Pegged Single Currency: U.S. dollar||QI91||Currency conversion.|
|Pegged Single Currency: U.S. dollar||Other Managed Floating||QI93||A crawling peg system introduced: the rate of the crawl set at 5 percent on an annual basis.|
|Nigeria||Independently Floating||Pegged Single Currency: U.S. dollar||QI94||Measures to tighten exchange control are introduced.|
|Norway||Pegged Currency Composite: Other||Independently Floating||QIV92||The authorities discontinue the peg to the ECU.|
|Poland||Pegged Single Currency: U.S. dollar||Pegged Currency Composite: Other||QII91||Arrangement of pegging the zloty to the U.S. dollar replaced with a peg to a basket of five currencies (U.S. dollar, deutsche mark, pound sterling, French franc, and Swiss franc).|
|Pegged Single Currency: U.S. dollar||Other Managed Floating||QIV91||Crawling peg system comes into effect, aimed at achieving a depreciation of 1.8 percent a month by depreciating the exchange rate Z1 9 each business day.|
|Portugal||Other Managed Floating||Flexibility Limited||QII92||Portugal joined the exchange rate mechanism (ERM) of the European Monetary System, and set margins of 6 percent above and below the central rates for the other ERM members’ currencies.|
|Romania||Pegged Currency Composite: Other||Independently Floating||QII91||Participation in the dual interbank market extended to noncommercial entities, residents, and nonresident individuals through introduction of foreign exchange bureaus. An official foreign exchange rate is also in effect.|
|Independently Floating||Other Managed Floating||QIV9I||Temporary dual exchange rate system unified. The unified exchange rate is determined daily at a fixing in the interbank market, in which the National Bank of Romania and authorized commercial banks participate.|
|Other Managed Floating||Independently Floating||QII92||Fixing session replaced with foreign exchange auction system; free functioning of this system on a market basis functioned sporadically from September 30, 1992 onward.|
|Russia1||—||Independently Floating||QIII92||Several exchange rates are in effect at this time.|
|San Marino1||—||Pegged Single Currency: Other||QIII93||The currency of San Marino is the Italian lira.|
|Sao Tome and Principe||Pegged Currency Composite: Other||Other Managed Floating||QIII91||Crawling peg policy aimed at achieving a nominal devaluation of 3.8 percent a month introduced.|
|Slovak Republic1||—||Pegged Currency Composite: Other||QII94||The currency of the Slovak Republic is the Slovak crown or koruna. The external value was initially based on a basket consisting of the currencies with the largest shares in external transactions. Since July 1994, the basket has consisted of the U.S. dollar and the deutsche mark. This rate applies to all transactions except those with the Czech Republic.|
|Slovenia1||—||Other Managed Floating||QII93||The Slovenian tolar is managed flexibly in an interbank market for foreign exchange.|
|Sudan||Pegged Single Currency: U.S. dollar||Independently Floating||QI92||Multiple exchange rate regime abolished and replaced by a unified free exchange market in which the exchange rate is determined in an interbank market.|
|Independently Floating||Other Managed Floating||QIV93||A dual exchange rate system is introduced, comprising a central and a commercial exchange rate.|
|Suriname||Pegged Single Currency: U.S. dollar||Other Managed Floating||QIII94||The exchange market is unified.|
|Sweden||Pegged Currency Composite: Other||Independently Floating||QIV92||The authorities cease to peg the krona to the ECU.|
|Switzerland1||—||Independently Floating||QIII92||The rate of the Swiss franc is determined on the basis of underlying demand and supply.|
|Tajikistan1||—||Pegged Single Currency: Other||QII94||The currency of the Republic of Tajikistan is the Russian ruble.|
|Tanzania||Pegged Currency Composite: Other||Independently Floating||QIII93||Dual exchange market unified and weekly auctions introduced.|
|Tonga||Pegged Single Currency: Other||Pegged Currency Composite: Other||QI91||Link between the Pa’anga and the Australian dollar, which had existed since 1976, terminated, and the Pa’anga repegged to a weighted basket of currencies.|
|Trinidad and Tobago||Pegged Single Currency: U.S. dollar||Independently Floating||QII93||Licensed authorized dealers allowed to conduct all types of foreign exchange transactions: all exchange controls relating both to current and capital transactions eliminated.|
|Turkmenistan1||—||Pegged Single Currency: Other||QII93||The Russian ruble circulates as legal tender in Turkmenistan.|
|Pegged Single Currency: Other||Other Managed Floating||QIV93||A new national currency, the manat, determined in weekly auctions, is introduced as sole legal tender.|
|Other Managed Floating||Pegged Single Currency: U.S. dollar||QI94||Foreign exchange auctions are reinstated, and the official rate is adjusted (other rates exist for surrender of gas export receipts and for trading bank notes).|
|Uganda||Pegged Currency Composite: Other||Independently Floating||QII92||Auction system for allocating donor import support introduced, and the allocation for all foreign exchange based on a market-determined exchange rate.|
|Ukraine1||—||Independently Floating||QIII92||The karbovanets becomes the sole legal tender in Ukraine.|
|United Kingdom||Flexibility Limited||Independently Floating||QIII92||Change effected in the context of the withdrawal of the pound sterling from the ERM.|
|Venezuela||Independently Floating||Other Managed Floating||QII93||The Central Bank of Venezuela is the recipient and the supplier of most of the foreign exchange and its actions can influence the exchange rate in this market. Further information made available to IMF staff indicates that the Central Bank has been managing the exchange rate flexibly.|
|Other Managed Floating||Pegged Single Currency: U.S. dollar||QIII94||Exchange controls are tightened.|
|Yugoslavia, former Socialist Federal Rep. of||Pegged Single Currency: Other||Pegged Single Currency: U.S. dollar||QII92||Currency conversion effected and the new dinar was pegged to the U.S. dollar rather than to the deutsche mark.|
|Zambia||Adjusted According to a Set of Indicators||Independently Floating||QIV92||A dual exchange rate system is introduced. The bureau de change exchange rate, applied to most transactions, is market-determined.|
|Zimbabwe||Pegged Currency Composite: Other||Independently Floating||QIII94||The dual exchange rate system is unified.|
Initial notification of member’s exchange rate arrangement.
Notification dated January 26, 1994.
This appendix briefly describes the multiple currency practices that were maintained by member countries as of September 30, 1994 unless otherwise indicated.
Afghanistan, Islamic State of
The Islamic State of Afghanistan maintains a multiple exchange rate system. Based on the free market exchange rate, its exchange rate arrangement is classified as independently floating. The various exchange rates are (I) the free exchange rate in the bazaar, in which most foreign currency transactions take place; (2) the official exchange rate, which is pegged to the U.S. dollar, applicable to certain official transactions, mainly debt-service payments; (3) the commercial exchange rate, which is set monthly at a level equivalent to a three-month moving average of the market exchange rate, and applies to five essential commodities; and (4) an exchange rate at which transactions with international organizations, aid agencies, and embassies are conducted, which is set at the level of 80 percent of the commercial exchange rate.
The official exchange rate of the manat has been set, effective May 24, 1994, on the basis of a weighted average of the rates quoted by the commercial banks. The official rate applies to official transactions in foreign exchange, surrender of export proceeds from nonstrategic exports, and for accounting purposes. Strategic exports continue to be valued al domestic prices while nonstrategic exports are surrendered at the official rate, giving rise to a multiple currency practice.
The official exchange rate of the Bahamian dollar is pegged to the U.S. dollar at B$1 per US$1.
The Central Bank administers an “investment currency market” in which residents may purchase foreign exchange for capital transactions at a premium through the Central Bank. Al end-1993, the premium was B$1.20 per US$1 (bid) and B$1.25 per US$1 (offer).
A multiple currency practice arises from a tax on the repatriation of profits by nonresidents, and from a spread between the official exchange rate and the exchange rates negotiated freely in the foreign exchange market outside the hard currency auctions.
The external value of the pula, the currency of Botswana, is determined with reference to a weighted basket comprising the currencies of the country’s major trading partners. A foreign exchange risk-sharing scheme that applies to borrowing by parastatals outstanding as of December 1, 1990 gives rise to a multiple currency practice.
The exchange rate is determined by demand and supply in the interbank market. However, a dual exchange market results from the official foreign exchange interbank market, the rate of which applies to the following transactions: imports, exports, remittances of profits and dividends, capital repatriation, debt service, approved foreign investment, and the tourist exchange market, in which the exchange rate for receipts from tourism is freely determined by participants in the market.
Purchases for a number of current invisibles are subject to the financial transaction tax of 25 percent.
The exchange rate of the Chilean peso is adjusted at daily intervals according to a schedule established on the basis of the domestic rate of inflation during the previous month, less the estimated world rate of inflation. Dual foreign exchange markets are in effect: the official foreign exchange market, which comprises commercial banks, exchange houses, and other entities licensed by the Central Bank; and an informal foreign exchange market, through which all transactions not required to be channeled through the official foreign exchange market are allowed to take place. In both markets, economic agents are free to negotiate exchange rates.
The currency of the Czech Republic1 is the Czech koruna, the external value of which is determined on the basis of a basket of currencies comprising the deutsche mark and the U.S. dollar. This exchange rate is permitted to fluctuate within margins of ±0.5 percent and it applies to all transactions, except for those with the Slovak Republic. A market-determined exchange rate applies to tourist transactions with the Slovak Republic.
All transactions with the Slovak Republic, except for re-exports, must go through a clearing account with the two central banks; transactions are converted from the currency of the contract into clearing ECUs at rates set by the respective central banks, which can differ by up to 5 percent from the market rate against the clearing ECU. Special exchange arrangements apply to settlements of balances under terminated bilateral payments agreements with some socialist and former socialist countries outside the former Council for Mutual Economic Assistance (CMEA).
The multiple exchange rate system in effect consists of the following three exchange rates: (1) the free market rate; (2) the central bank exchange rate; and (3) the official exchange rate (used for accounting purposes only and equal to the central bank selling rate). The central bank selling rate, which is established weekly as the average of the free market rate of the preceding week, is applied to the public sector’s external payments and to foreign exchange transactions of foreign petroleum companies. The same rate also applies to disbursements of external credits and grants to the public sector, but a separate central bank buying rate, which is S/. 250 per US$1 lower than the selling rate, is applied to all other foreign exchange receipts of the public sector.
There is a spread of more than 2 percent between the official buying and selling rate in the intervention market, which is applied to foreign credit disbursements or guarantees by the public sector, public sector purchases of foreign exchange, and transactions of the private oil company.
Since November 28, 1991, a unified free market exchange rate has been applied to all transactions. A special exchange rate of LE 1.30 per US$1, however, applies to transactions effected under the bilateral payments agreement with Sudan. Additionally, an exchange rate of LE 0.3913 per US$1 is used for the liquidation of balances related to past bilateral payments agreements.
Ethiopia maintains a dual exchange rate regime comprising an official exchange rate and the auction exchange rate. The official rate is pegged to the U.S. dollar and applies to a limited number of payments, such as imports of petroleum products, pharmaceuticals, and fertilizers, and for the Government’s foreign exchange contributions to international organizations and official debt-service payments. The auction exchange rate, the marginal auction exchange rate established on a fortnightly basis, applies to all current and capital account transactions. Ethiopia’s exchange rate arrangement, based on the auction exchange rate, is classified as independently floating.
Iran, Islamic Republic of
The currency of the Islamic Republic of Iran is the Iranian rial. With effect from May 4, 1994, a dual exchange system was introduced, comprising the export and the official floating exchange rates. The new export exchange rate is set daily at Rls 50 per US$1 lower than the midpoint of the buying and selling rates in the free market. The official floating rate is announced daily in terms of the SDR. A multiple currency practice arises from an advance import deposit requirement associated with certain import payments.
Lao People’s Democratic Republic
The official exchange rate is managed by the central bank based on developments in the parallel market and is applied to all transactions between the central bank and the commercial banks. Commercial banks and foreign exchange bureaus are permitted to buy and sell foreign exchange at freely determined rates.
The official (commercial) exchange rate is pegged to the South African rand at par. The financial rand scheme, under which the balances of the financial rand are transferable among nonresidents at freely determined exchange rates and may be used for purchasing securities and for financing investments in new firms and certain properties, constitutes a multiple currency practice, because the practice involves some current account transactions.
The official exchange rate is pegged to the U.S. dollar at par, and the U.S. dollar is also allowed to circulate as legal tender; most government transactions go through the official exchange market. A parallel market exists that is recognized de facto by the authorities and through which a much larger number of transactions, including some government transactions, is effected. The parallel market gives rise to a multiple currency practice.
Socialist People’s Libyan Arab Jamahiriya
The currency of the Libyan Arab Jamahiriya is the Libyan dinar, which is pegged to the SDR. Two multiple currency practices are in effect as a result of a 10 percent fee that has been levied since 1985 on outward foreign exchange transfers for the purpose of financing the Great Man-Made River Project. Since 1989, importers have been required to put an advance import deposit equal to 20 percent of the import value before a letter of credit may be opened.
The external value of the Maltese lira, the currency of Malta, is determined on the basis of a weighted basket of currencies consisting of the pound sterling, the U.S. dollar, and the ECU, Since 1983, an exchange rate guarantee scheme for British and Irish tour operators has been in effect, giving rise to a multiple currency practice.
The currency of Mauritania is the ouguiya, the external value of which is determined on the basis of a weighted basket of currencies comprising the Belgian franc, the deutsche mark, the French franc, the Italian lira, the Spanish peseta, and the U.S. dollar. A dual exchange rate regime emerges from use of the official exchange rate for most transactions and the free market rate, which is applicable to transactions of foreign currency notes and traveler’s checks.
Multiple currency practices arise from (1) forward cover facilities, which were provided by the central bank for industries operating in the export processing zone and by banks that are engaged in foreign borrowing for lending to the sugar sector, and (2) the inoperative exchange rate guarantee by the central bank for nonresident foreign currency deposit accounts.
The exchange rate system consists of the official exchange rate against the U.S. dollar for noncash transactions, which is established in the fixing sessions at the Chisinau Interbank Foreign Currency Exchange, and the exchange rate for cash transactions, which is freely determined in the exchange market operated by exchange bureaus and other authorized dealers. The official exchange rate is applied to foreign exchange surrendered to the National Bank of Moldova and to official external debt-service payments and used for accounting and tax valuation purposes.
The currency of Myanmar is the Myanmar kyat, which is pegged to the SDR. An export retention scheme and the issuance of foreign exchange certificates issued at par with the U.S. dollar for tourists entering Myanmar give rise to a multiple currency practice.
As a member of the Common Monetary Area (CMA), Namibia participates in the financial rand system, under which local sales and redemption proceeds of CMA member country securities and other investments owned by non-CMA residents are transferable among non-CMA residents at a freely negotiated exchange rate (usually at a discount from the commercial rand rate) through financial rand balances maintained at authorized banks. The financial rand scheme gives rise to a multiple currency practice.
The dual exchange rate system in effect consists of (1) the official exchange rate, which is pegged to the U.S. dollar and devalued daily at an annual rate of 12 percent, and (2) the foreign exchange house rate, which was introduced in September 1991 and is determined freely based on market forces.
Dual exchange rates consist of the official exchange rate, pegged to a basket of five currencies and managed flexibly and applicable to most transactions, while individuals may make payments and transfers that are not eligible for foreign exchange at the official exchange rate with foreign exchange acquired at the parallel rate determined by market forces.
The currency of the Slovak Republic is the Slovak crown or koruna. the external value of which is determined on the basis of a basket of the five currencies with the largest share in the country’s external transactions. It applies to all transactions except those with the Czech Republic. Transactions with the Czech Republic must go through a clearing account with the two central banks, in which transactions are converted from the currency of the contract into clearing ECUs at a rate set by the respective central banks that may differ by up to 5 percent from the official rate against the ECU. Special arrangements apply to settlements of balances under terminated bilateral payments agreements with some socialist countries outside the former CMEA.
The dual exchange rate system consists of (1) the official exchange rate, which is pegged to a basket of currencies and is adjusted weekly by the Central Bank: it applies to imports of goods and services and debt-service payments of the Government, and (2) the free market exchange rate, which is negotiated freely between resident holders of foreign exchange accounts.
A 10 percent levy is imposed on all applications for purchases of foreign exchange under the commodity import program. In addition, a non-interest-bearing cash advance deposit of 100 percent is required to open letters of credit for private sector imports; the deposit is retained until the letters of credit are settled.
A dual exchange rate system emerges from the financial rand scheme, which operates with respect to (I) the local sale and redemption proceeds of South African securities and other investments in South Africa owned by nonresidents; (2) outward remittances by emigrants; inward remittances by immigrants, and certain investment capital transfers; and (3) approved outward capital transfers by residents. The exchange rate of the financial rand is depreciated with respect to the commercial rand exchange rate.
Syrian Arab Republic
The multiple exchange rate regime consists of the following three rates: (1) the official exchange rate applies, on the receipts side, to government transactions, public sector exports of oil, and certain agricultural products: and, on the payments side, to government transactions, public sector imports of certain agricultural commodities, public sector invisibles payments, and capital transactions; (2) the promotion exchange rate applies only to some student allowances; and (3) the rate in neighboring countries, which is determined by the Central Bank and the Commercial Bank of Syria and is applied to tourist receipts, private remittances, the valuation of external loans and grants, the 25 percent of proceeds surrendered by the private sector from most exports, and 100 percent of proceeds surrendered by the private sector from exports of fruits, vegetables, and a number of other agricultural items. It also applies to travel allowances, medical expenses, remittances abroad, imports by public sector enterprises, and domestic expenditures of non-oil foreign companies. In addition to these three exchange rates, a separate exchange rate, for customs duty purposes, is used to value imports of nonessential goods.
As of July 1994, the 1993 Russian ruble circulated as sole legal tender in Tajikistan. Three different exchange rates are in use in the country. First is an official rate, which is quoted by the central bank twice weekly on the basis of the midpoint of buying and selling rates for the Russian ruble rate against the U.S. dollar in the Moscow Interbank Foreign Currency Exchange. This rate is used for official debt-service payments and all transactions involving the State Foreign Currency Fund, including surrender of export receipts. A separate rate is used for accounting purposes by the central bank. Finally, a freely negotiated market exchange rate is established in the commercial bank market. A multiple currency practice arises from the difference between the free market rate and the official exchange rate.
The national currency, the sum, was introduced on July 1. 1994, with the official exchange rate initially set to Sum 7 per US$1. This rate applies to all international transactions conducted through the commercial banks. On August 1, 1994, the authorities introduced a special cash exchange rate to be used by state-owned exchange bureaus, initially set at Sum 35 per US$ 1. By the end of September 1994, this rate had appreciated to Sum 20.8 per US$1.3
The exchange rate is managed flexibly, with all exchange transactions taking place at the rate established at foreign exchange trading floors located in Hanoi and Ho Chi Minh City. A 5–10 percent tax is imposed on profit remittances from foreign direct investment.
Yemen, Republic of
The foreign exchange market in Yemen consists of the official market, in which multiple rates apply, and the parallel market. An official exchange rate applies essentially only to government transactions—oil trade, government imports, and service payments and receipts, and official external financial flows and debt servicing—and is also used for valuing the banking system’s foreign positions. A basic food exchange rate applies to central bank financing of three food imports—wheat, flour, and rice. An incentive exchange rate applies to imports by public enterprises and entities and under bilateral and multilateral assistance; those purchases of local currency by oil companies that must be made at the Central Bank; and on a more or less voluntary basis to local embassies and tourists. The parallel market operates outside the banking system, is the venue for the majority of non-oil external transactions, and is fully accessible for all purposes.
The official and the parallel market rates were unified in August 1991. However, despite unification, informal arrangements under which exporters transact with importers at freely negotiated rates outside the free exchange market are still in effect. This segmentation of the exchange market gives rise to a multiple currency practice.
World Economic and Financial Surveys
This series (ISSN 0258-7440) contains biannual, annual, and periodic studies covering monetary and financial issues of importance to the global economy. The core elements of the series are the World Economic Outlook report, usually published in May and October, and the annual report on International Capital Markets, Other studies assess international trade policy, private market and official financing for developing countries, exchange and payments systems, export credit policies, and issues raised in the World Economic Outlook.
World Economic Outlook: A Survey by the Staff of the International Monetary Fund
The World Economic Outlook, published twice a year in English, French, Spanish, and Arabic, presents IMF staff economists’ analyses of global economic developments during the near and medium term. Chapters give an overview of the world economy; consider issues affecting industrial countries, developing countries, and economies in transition to the market; and address topics of pressing current interest.
$34.00 (academic rate; $23.00; paper).
1994 (May). ISBN 1-55775-381-4. Stock #WEO-194.
1994 (Oct.). ISBN 1-55775-385.7. Stock #WEO-294.
International Capital Markets: Developments, Prospects, and Policy Issues
by an IMF Staff Team led by Morris Goldstein and David Folkerts-Landau
This annual report reviews developments in international capital markets, including recent bond market turbulence and the role of hedge funds, supervision of banks and nonbanks and the regulation of derivatives, structural changes in government securities markets, recent developments in private market financing for developing countries, and the role of capital markets in financing Chinese enterprises.
$20.00 (academic rate: $12.00; paper).
1994. ISBN 1-55775426-8. Stock #WEO-694.
1993. Part I: Exchange Rate Management and international Capital Flows, by Morris Goldstein, David Folkerts-Landau, Peter Garber, Liliana Rojas-Suarez, and Michael Spencer.
ISBN 1-55775-290-7, Stock #WEO-693.
1993. Part II: Systemic Issues in International Finance, by an IMF Staff Team led by Morris Goldstein and David Folkens-Landau.
ISBN 1-55775-335-0. Stock #WE0-1293.
Staff Studies for the World Economic Outlook
by the IMF’s Research Department
These studies, supporting analyses and scenarios of the World Economic Outlook, provide a detailed examination of theory and evidence on major issues currently affecting the global economy.
$20.00 (academic rate; $12.00; paper).
1993. ISBN 1-55775-337-7. Stock #WEO-393.
Issues in International Exchange and Payments Systems
by a Staff Team from the IMF’s Monetary and Exchange Affairs Department
The global trend toward liberalization in countries’ international exchange and payments systems has been widespread in both industrial and developing countries and most dramatic in Central and Eastern Europe. Countries in general have brought their exchange systems more in line with market principles and moved toward more flexible exchange rate arrangements in recent years.
$20.00 (academic rate: $12.00; paper).
1995. ISBN 1-55775-480-2. Stock #WEO-895.
Private Market Financing for Developing Countries
by a Staff Team from the IMF’s Policy Development and Review Department
This study surveys recent trends in private market financing for developing countries, including flows to developing countries through banking and securities markets; the restoration of access to voluntary market financing for some developing countries; and the status of commercial bank debt in low-income countries.
$20.00 (academic rate: $12.00; paper).
1995. ISBN 1-55775-456-X. Stock #WEO-994.
1993. ISBN 1-55775-361-X. Stock #WEO-993.
International Trade Policies
by a Staff Team led by Naheed Kirmani
The study reviews major issues and developments in trade and their implications for the work of the IMF, Volume I, The Uruguay Round and Beyond: Principal Issues, gives and overview of the principal issues and developments in the world trading system. Volume II, The Uruguay Round and Beyond: Background Papers, presents detailed background papers on selected trade and trade-related issues. This study updates previous studies published under the title Issues and Developments in International Trade Policy.
$20.00 (academic rate: $12.00: paper).
1994. Volume I. The Uruguay Round and Beyond: Principal Issues
ISBN 1-55775-469-1. Stock #WE0-l094.
1994. Volume II. The Uruguay Round unci Beyond: Background Papers
ISBN 1-55775-457-8. Stock #WEO-1494.
1992. ISBN 1-55775-31-1. Stock #WEO-1092.
Official Financing for Developing Countries
by a Staff Team from the IMF’s Policy Development and Review Department led by Michael Kuhn
This study provides information on official financing for developing countries, with the focus on low- and lower-middle-income countries. It updates and replaces Multilateral Official Debt Rescheduling: Recent Experience and reviews developments in direct financing by official and multilateral sources.
$20,00 (academic rate: $12,00: paper)
1994. ISBN 1-55775-378-4, Stock #WEO-1394.
Officially Supported Export Credits: Recent Developments and Prospects
by Michael G. Kuhn, Balazs Horvath, Christopher J. Jarvis
This study examines export credit and cover policies in major industrial countries.
$20.00 (academic rate: $12.00; paper).
1995. ISBN 1-55775-448-9. Stock #WEO-595.
Available by series subscription or single title (including hack issues): academic rate available only to full-lime university faculty and students.
Please send orders and inquiries to:
International Monetary Fund, Publication Services, 700 19th Street, N.W.
Washington, D.C. 20431, U.S.A.
Tel.: (202) 623-7430 Telefax: (202) 623-7201
See Developments in International Exchange and Trade Systems, World Economic and Financial Surveys (Washington: IMF, September 1989), and Developments in Exchange and Payments Systems, World Economic and Financial Surveys (Washington: IMF, June 1992).
A number of staff papers prepared for the Executive Board in recent years have addressed policies for specific forms of exchange controls, including multiple exchange rates, bilateral payments arrangements and countertrade, and external payments arrears. General policies for exchange controls have been addressed in the biennial exchange system surveys, such as the present one, and previous to these surveys, in Part 1 of the AREAER. References to these policy issues may also be found in IMF, Selected Decisions and Selected Documents of the International Monetary Fund (Washington: IMF, 1994) (see various decisions relating to Articles VIII and XIV).
Exchange controls affecting exports or export receipts do not fall within the meaning of current account convertibility under the IMF’s Article VIII. The major types of exchange control governing export transactions are repatriation and surrender requirements on foreign exchange receipts. Although these controls fall outside the jurisdiction of the IMF, unless multiple currency practices are involved, they are subject to careful surveillance by the IMF as a form of capital control (see Section III), and because a system of exchange controls on current international payments and transfers relies on centralization of foreign exchange receipts. Fiscal incentives for exports, such as exemption from taxes and special credit facilities, were identified to be in use by some 31 members at the end of 1993, and some 56 members were imposing export taxes or other fees for revenue purposes. Nearly three-fourths of IMF members maintained controls on exports, either through licensing requirements with or without explicit quotas, or through specific prior authorization requirements for exports of certain products. The controls in most of these countries, both industrial and developing, were administered only for specific products or products involved in bilateral trade arrangements.
Algeria, Angola, Iraq, Mongolia, Myanmar, Suriname, Syrian Arab Republic, and Republic of Yemen.
Negative list regimes are much simpler to administer and tend to be more liberal, as the list of restricted or prohibited imports can be kept short and discretionary and administrative decisions regarding license issuance need not be made. Negative import regimes are commonly applied by members that are restricting or prohibiting imports for reasons other than to affect the balance of payments, for example, to protect domestic producers or for phytosanitary purposes.
For a general discussion of multiple exchange rates, see Section IV.
Restrictions on debt payments associated with external payments arrears and debt-restructuring arrangements are discussed in Section II.
Members of the Central Bank of West African States (BCEAO) and the Bank of Central African States (BEAC) suspended the repurchase of CFA franc bank notes circulating outside the territories of the CFA franc zone.
Data for external payments arrears discussed in this section include arrears caused by exchange restrictions on current international payments or transfers, as well as arrears on financial obligations of which the obligor is the government (defaults), which are not subject to the IMF’s jurisdiction.
This is to give effect to Executive Board Decision No. 1034 (60/27), adopted June 1, 1960, which states that “it would be desirable that, as far as possible [members] eliminate measures that would require the approval of the Fund, …” (Selected Decisions (June 1994)).
The new Article VIII members and their dates of acceptance are: The Gambia, Morocco, and Tunisia (January 1993); Federated States of Micronesia (June 1993); Lebanon (July 1993); Israel and Mauritius (September 1993); Barbados (November 1993); Trinidad and Tobago (December 1993); Grenada (January 1994); Ghana (February 1994); Sri Lanka (March 1994); Bangladesh and Uganda (April 1994); Lithuania and Nepal (May 1994); Kenya and Latvia (June 1994); Pakistan (July 1994); Estonia, India, and Paraguay (August 1994); Western Samoa (October 1994); and Malta (November 1994). Four members accepted Article VIII obligations in 1992, and three of them did not have any exchange restrictions when they joined the IMF: Marshall Islands (May 1992); Switzerland (May 1992); and San Marino (September 1992). See Table 1 for a listing of remaining Article XIV members.
Amortization of loans and depreciation of direct investment are regarded as a capital transaction in the balance of payments. All remittances representing a transfer of income between residents and nonresidents are regarded as current transactions in the balance of payments.
Executive Board Decision No. 1034–(60/27), June 1, 1960, in Selected Decisions (June 1994).
Executive Board Decision No. 144–(52/51), August 14, 1952 in Selected Decisions (June 1994), provides that restrictions reported to the IMF pursuant to this Decision are approved for purposes of Article VIII, Section 2, unless the IMF informs the member within 30 days of receiving the notice that it is not satisfied that such restrictions are proposed solely to preserve national or international security. In recent years, many members have notified the IMF of exchange restrictions imposed against Haiti, Iraq, the Libyan Arab Jamahiriya, and the Federal Republic of Yugoslavia (Serbia and Montenegro) under this Decision.
In a few instances, acceptance of Article VIII obligations has been encouraged in the presence of remaining Article VIII restrictions—provided that these are relatively minor and the countries have a clear-cut timetable for removing them (for example, Bangladesh and Mauritius).
As of April 1994, 98 developing countries were members of GATT; in addition, 14 other developing countries observed the regulations of GATT, although they did not subscribe to GATT membership. (These numbers exclude Aruba, the Netherlands Antilles, and Hong Kong, for which the Articles of the IMF have been accepted by the Kingdom of the Netherlands and the United Kingdom, respectively.) Of those developing countries that are members of GATT, all except Brunei and Cuba are also members of the IMF. On the other hand, 59 developing countries that are members of the IMF are not members of GATT, while 13 of these member countries of the IMF apply GATT regulations in practice. Of those IMF members that have accepted the obligations of Article VIII, 21 do not belong to GATT but 7 of them apply GATT regulations.
During the 1980s, only Finland, France, Norway, and Spain felt it necessary to suspend temporarily the freedom of capital movements under the codes of liberalization of capital movements of the Organization for Economic Cooperation and Development (OECD). For a detailed discussion see Liberalization of Capital Movements and Financial Services (Paris: OECD, 1990).
The IMF and the World Bank, mainly through the work of the Development Committee, have emphasized this aspect in recent documents. See Determinants and Systemic Consequences of International Capital Flows, IMF Occasional Paper No. 77 (Washington: IMF, 1991); Development Committee, Development Issues: Presentations to the 46th Meeting of the Development Committee, Development Committee Series No. 31 (Washington: World Bank, 1993); “Development Committee Communique” and “Group of 24 Communiqué,” IMF Survey, May 17, 1993; and G.P. Pfeffermann and A. Madarassy, Trends in Private Investment in Developing Countries, 1993: Statistics for 1970–91, IFC Discussion Paper No. 16 (Washington: World Bank, December 1992).
By the end of MIGA’s first full financial year of operations, 69 preliminary applications for guarantee covering potential direct investments in 24 member developing countries and a broad range of sectors were registered with MIGA. In 1992–93, MIGA facilitated almost $2 billion in direct investment flows. Given the long-term nature of most direct investment, MIGA typically provides guarantees for 15 years.
The prototype treaty reflects six principles of a liberal investment regime, including free transfers of foreign exchange for all capital and all returns on an investment; full convertibility is to apply to any investments covered by a BIT. As of July 7, 1993, 24 countries had signed BITs with the United States, including 10 countries from Eastern Europe or the former Soviet Union, of which 13 have come into force.
See Section IV.
A number of other countries have free or liberal capital systems, mainly those with structurally strong balance of payments positions. Venezuela has very recently reintroduced limitations on convertibility, and Mauritius has reportedly introduced capital convertibility.
While there is some evidence that capital inflows in Chile slackened temporarily following the introduction of the controls, evasion of the controls also began quickly; see S. Schadler, M. Carkovic, A. Bennet, and R. Kahn, Recent Experiences with Surges in Capital Inflows, IMF Occasional Paper No. 108 (Washington: IMF, 1993).
Interest rates in Indonesia and Venezuela were subject to regulation at the time of the full exchange system liberalization although interest rates had already been adjusted to market-determined levels.
P. Quirk, “Capital Account Convertibility: A New Model for Developing Countries,” in Frameworks for Monetary Stability, ed. by T. Baliño and C. Cottarelli (Washington: IMF, 1994); DJ. Mathieson and L. Rojas-Suarez, Liberalization of the Capital Account: Experiences and Issues, IMF Occasional Paper No. 103 (Washington: IMF, 1993); N.U. Haque and P. Montiel, “Capital Mobility in Developing Countries—Some Empirical Tests,” IMF Working Paper No. 90/117 (Washington: IMF, 1990); H. Faruqee, “Dynamic Capital Mobility in Pacific Basin Developing Countries: Estimates and Policy Implications,” Staff Papers, International Monetary Fund, Vol. 39 (September 1992); J.E. Greene and P. Isard, Currency Convertibility and the Transformation of Centrally Planned Economies, IMF Occasional Paper No. 81 (Washington: IMF, 1991); M. Dooley, “Country-Specific Risk Premiums, Capital Flight and Net Investment Income Payments in Selective Developing Countries” (unpublished; Washington: IMF, 1986); M. Deppler and M. Williamson, “Capital Flight: Concepts, Measurement, and Issues,” Staff Studies for the World Economic Outlook (Washington: IMF, 1987), pp. 39–58.
See M. Guitian, “Capital Account Liberalization: Bringing Policy in Line with Reality,” in Capital Controls, Exchange Rates, and Monetary Policy in the World Economy, ed. by S. Edwards (Cambridge, Mass.: Cambridge University Press, forthcoming, 1995).
Following a 1989 amendment, the OECD codes generally apply to all underlying capital transactions. Prior to that amendment, most short-term capital movements, except for commercial credits and loans, were excluded from the codes. The codes were broadened to cover practically all types of capital movements, but they do not extend the obligations of members to all types of exchange transactions related to capital movements. For example, taxes on transfers, multiple currency practices applicable to capital transactions, and advance deposit requirements are not covered by the codes. The OECD membership includes all countries classified by the IMF as industrial countries as well as Turkey.
Proposals to liberalize capital movements within the EU were first expressed in a 1983 initiative on financial integration. This was followed by a 1987 directive liberalizing certain long-term capital transactions and security market transactions between members. The list covered long-term credits relating to commercial transactions and the acquisition in the capital market of one member state of securities issued by a company in another member state. Shortly thereafter, the EU considered the elimination of all remaining capital controls as part of a plan to establish a European financial common market by 1992 in the context of a single market in which goods, services, capital, and individuals move freely. The conditions for such a market included not only elimination of capital controls, but also harmonization of bank supervision rules and taxes on capital yields.
J.M. Keynes, “Proposals for an International Clearing Union,” British Government White Paper Cmd. 6437, April 1943. For a discussion of this paper, see J.K. Horsefield (ed.), The International Monetary Fund, 1945–1965: Twenty Years of Internation Monetary Cooperation, Vol. 3, Documents (Washington: IMF, 1969).
J. Gold, International Capital Movements Under the Law of the International Monetary Fund, IMF Pamphlet Series No. 21 (Washington: IMF, 1977).
H.D. White, “Preliminary Draft Proposal for a United Nations Stabilization Fund and a Bank for Reconstruction and Development of the United and Associated Nations” (Mimeo; April 1942). For a discussion of this paper, see J.K. Horsefield (ed.), International Monetary Fund, 1945–1965.
United States, Department of the Treasury, The Bretton Woods Proposals: Questions and Answers on the Fund and the Bank” (Washington: U.S. Treasury, 1944).
“The Fund shall consider the following developments as among those which might include the need for discussion with a member:
(iii) (b) the introduction or substantial modification for balance of payments purposes of restrictions on, or incentives for, the inflow or outflow of capital;
(iv) the pursuit, for balance of payments purposes, of monetary and other domestic financial policies that provide abnormal encouragement or discouragement to capital flows; and
(v) behavior of the exchange rate that appears to be unrelated to underlying economic and financial conditions including factors affecting competitiveness and long-term capital movements.”
Selected Decisions (Washington: IMF, 1993).
See, for example, E. Borensztein and P.R. Masson, IMF Occasional Paper No. 102, Exchange Arrangements of Previously Centrally Planned Economies (Washington: IMF, 1993); R. MacDonald and M.P. Taylor, “Exchange Rate Economics: A Survey,” Staff Papers, International Monetary Fund, Vol. 39 (March 1992); J.A. Frenkel, M. Goldstein, and P.R. Masson, Characteristics of a Successful Exchange Rate System, IMF Occasional Paper No. 82 (Washington: IMF, 1991); B.B. Aghevli, M.S. Khan, and P.J. Montiel, Exchange Rate Policy in Developing Countries: Some Analytical Issues, IMF Occasional Paper No. 78 (Washington: IMF, 1991); P.J. Quirk, B.V. Christensen, K. Huh, and T. Sasaki, Floating Exchange Rates in Developing Countries: Experience with Auction and Interbank Markets, IMF Occasional Paper No. 53 (Washington: IMF, 1987).
AREAER (Washington: IMF, 1994).
For discussion of existing currency board arrangements, see K. Osband and D. Villanueva, “Independent Currency Authorities: An Analytical Primer,” IMF Working Paper No. 92/50 (Washington: IMF, 1992).
Cameroon, Central African Republic, Chad, Congo, Equatorial Guinea, and Gabon.
In addition, while the Comoros is not formally a member of the CFA franc zone, its exchange arrangements with France are very similar to those of the CFA franc countries.
Anguilla, Antigua and Barbuda, Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines.
The information for 1994 relates to the first three quarters.
For those countries remaining in the ERM, arrangements become more flexible in the sense that, with the exception of the cross rate between the deutsche mark and the Netherlands guilder, intervention margins have increased from ±2.25 percent to ±15 percent since August 1993.
Angola, Belarus, Bulgaria, Guyana, Haiti, India, Islamic Republic of Iran, Kenya, Mongolia, Nepal, Sudan, Suriname, Tanzania, and Zimbabwe.
Albania, Dominican Republic, Ethiopia, Georgia, Latvia, Malawi, Romania, Trinidad and Tobago, and Uganda.
Armenia, Azerbaijan (initially pegged to the Russian ruble), Kazakhstan, Kyrgyz Republic, and Moldova.
Costa Rica (eliminated crawling peg); Croatia (implemented a new foreign exchange law); Honduras (increased participation in the foreign exchange market (June 1994) and then moved back to a managed float); Madagascar (created an interbank market at the same time); and Mozambique and Zambia (eliminated arrangements based on indicators).
Burundi and Tonga (from the SDR and the Australian dollar, respectively, to undisclosed baskets), the former Socialist Federal Republic of Yugoslavia in mid-1992 (from the deutsche mark to the U.S. dollar), and Poland (from a basket to the U.S. dollar and back to a basket).
See P. Quirk, G. Hacche, V. Schoofs, and L. Weniger, Policies for Developing Forward Foreign Exchange Markets, IMF ccasional Paper No. 60 (Washington: IMF, 1988).
Their use to influence imports is discussed in Section II.
The existence of a secondary (parallel) market, where certain current transactions take place at a floating exchange rate that is more depreciated than the rate in the official market, is evidence of the inappropriateness of the official exchange rate. A parallel market exists in about 70 member countries where access to the official exchange market is restricted. A distinction may be made between legal and tolerated or illegal parallel markets from the standpoint of the jurisdiction of the IMF. If current transactions are channeled through more than one market, multiple currency practices result, which are subject to prior IMF approval.
Executive Board Decision No. 649–(57/33), June 26, 1957, Selected Decisions (Washington: IMF, 1992).
For further discussion of the 1984–85 review, see AREAER, Pt. 1 (Washington: IMF, 1985).
In addition, for approval to be granted, the measure must be introduced or maintained for balance of payments reasons, and it must not discriminate between IMF members.
Under the established policy, a period exceeding 90 days is considered unduly long.
A review of legal issues involved in identifying bilateral payments arrangements subject to IMF jurisdiction is now under way.
The bilateral (regional) payments arrangement is used here to refer to the methods of international settlement involving a bilateral (regional) clearing mechanism.
The Executive Board’s last review of bilateral payments arrangements took place in 1982 and concluded that there had been further progress by IMF members in reducing their reliance on bilateral payments arrangements. Earlier reviews were conducted in 1975, 1966, and throughout the 1950s, especially in 1955, J.K. Horsefield (ed.), The International Monetary Fund, 1945–1965, Vol. 2, Chronicles, pp. 302–305.
The countries are Cambodia, Indonesia, Lebanon, Nepal, Sri Lanka, and the Republic of Yemen.
Bangladesh (12 agreements), People’s Republic of China (25), Islamic Republic of Iran (10), Romania (12), and Viet Nam (15).
In some cases, balances are netted bilaterally between participants and net bilateral balances are passed to the regional clearinghouse for settlement.
The CACH increased its member countries from 3 in 1961 to 5, adding Nicaragua and Costa Rica in 1963; the PTA expanded its membership from 15 to 17 in 1989 with the addition of Angola and Mozambique, and to 18 in 1990; and the WACH increased the number of participants from 12 to 14 in 1976 and 1978, and to 15 in 1980.
All the countries of the former Soviet Union, except Azerbaijan, Georgia, and the Baltic states. Azerbaijan and Georgia subsequently signed the agreement.
Countertrade Outlook, Vol. 10 (August 10, 1992), p. 4.
For example, Latvia introduced tax exemptions for barter exports when imports of crucial raw materials and spare parts are involved, although this was only to facilitate the fulfillment of existing orders.
New agreements include those between Bulgaria and Russia and Ukraine, between Czechoslovakia and Russia and Ukraine, and an oil barter arrangement between Poland and Kazakhstan; Romania has reportedly signed bilateral commodity exchange agreements with Russia, Moldova, Turkmenistan, and other countries of the former Soviet Union.
Australia, Austria, Belgium, Canada, China, Denmark, Ecuador, Finland, Greece, Indonesia, Korea, Kuwait, Malaysia, Netherlands, Singapore, Spain, Sweden, Syria, Tunisia, Turkey, United Arab Emirates, and United Kingdom.
J.J. Polak, “Currency Convertibility in Eastern Europe: An Indispensable Element in the Transition Process,” Columbia Journal of World Business, Vol. 26 (Fall 1991), p. 41, concludes that “arrangements of this nature are of minimal economic effect…. The saving on reserves achieved by clearing payments on all intratrade rather than making and receiving payments transaction by transaction can at most be a trivial economy on float.”
S. Anjaria, S. Eken, and J. Laker, Payments Arrangements and the Expansion of Trade in Eastern and Southern Africa, IMF Occasional Paper No. 11 (Washington: IMF, 1982). An examination of the LAIA, the successor of LAFTA, shows that while it has economized on the use of convertible currency, the majority of the saving results from the operation of the bilateral clearing arrangements between the members and was gained as a result of higher costs (including lower quality of imports).
This objective has been stated by the EPU, the Caribbean Community Multilateral Clearing Facility of CARICOM, and CACH. F.A.G. Keesing and P.J. Brand (“Possible Role of a Clearing House in the Latin American Regional Market,” Staff Papers, International Monetary Fund, Vol. 10 (November 1963), pp. 397–458) state that a clearinghouse in the context of LAFTA has been considered by some as a prerequisite for the success of the trade liberalization policies pursued.
Experience has shown that the operating costs of clearing facilities can be quite high. In the WACH, for example, the average cost of a transaction in the last two years has been SDR 885. While the WACH may not be representative, the example shows the importance of considering the operating costs involved.
For example, Burundi, 1984–91; Dominican Republic, 1986; ECCB, 1982; Egypt, 1982–91; El Salvador, 1989; Guatemala, 1989; Guyana, 1990; Honduras, 1990; Hungary, 1991; Jamaica, 1984–90; Korea, 1989; Mauritania, 1991; Nepal, 1985–86; Nigeria, 1986–88; Romania, 1991; Sierra Leone, 1985; Somalia, 1986; and Venezuela, 1988–89.
This period corresponds to the shift of technical assistance advisory functions in foreign exchange to the newly formed Monetary and Exchange Affairs Department. Exchange system missions are now staffed by MAE personnel, by central bank experts, and, in the case of the Baltic countries, Russia, and other countries of the former Soviet Union, by personnel from cooperating central banks.
Albania, Bangladesh, Bulgaria, China, Croatia, Islamic Republic of Iran, and Romania.
Algeria, Burundi, Madagascar, Mauritania, Mongolia, Sudan, Tanzania, and Zimbabwe.
Ethiopia, Malawi, and Mozambique.
Bangladesh, Tunisia, and Uganda.
Fiji, Jamaica, and Trinidad and Tobago.
The Czech Republic and the Slovak Republic became members of the IMF on January 1, 1993, through the membership of the former Czech and Slovak Federal Republic.
Since December 31, 1991, the staff has not received information on the exchange and trade system from the Somali authorities.
On October 5, 1994, these two rates were unified at the level of Sum 20.2 per US$1, and the foreign currency auction was reintroduced.