Annual Report on Exchange Arrangements and Exchange Restrictions 2005


International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2005
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(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article XIVYes.
Exchange Arrangement
CurrencyThe currency of São Tomé and Príncipe is the São Tomé and Príncipe dobra.
Exchange rate structureUnitary.
Managed floating with no predetermined path for the exchange rateThe official exchange rate is computed on a daily basis as a simple average of the exchange rates of the exchange bureaus, the commercial banks, and the parallel market. The intervention currency is the dollar. Rates for certain other currencies are determined on the basis of exchange rates of the dollar for the currencies concerned. On March 17, 2004, the central bank issued a regulation reestablishing foreign exchange auctions. The first auction was held on December 9, 2004.
Exchange taxThe tax rates vary, according to the type of transaction involved. On import-related exchange transactions, when an LC is opened, a stamp duty of 0.25% of the import value and a postage levy of the equivalent of $2 are payable. On foreign checks for collection, commercial banks charge a commission of $2 a transaction. For the collection of export proceeds, a commission of 0.125% (a minimum of $25 and a maximum of $300) is charged when the LC is opened, and an additional fee of 0.125% is levied when the funds are received. A postage levy of Db 39,000 is also charged.
Exchange subsidyNo.
Forward exchange marketNo.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payments arrangements
Bilateral payments arrangements
InoperativeThere is an inoperative bilateral agreement with Angola. An outstanding debit balance remains with Angola.
Administration of controlImport and export licenses are granted freely by the Directorate of External Commerce for statistical purposes only.
International security restrictionsNo.
Payments arrears
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotesNo.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyYes.
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be opened freely and credited or debited, including for transfers abroad, as long as they are demand deposit accounts.
Domestic currency accountsYes.
Convertible into foreign currencyThese accounts may be converted and credited or debited, including for transfers abroad, as long as they are demand deposit accounts.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance import depositsAt the time an LC is opened, importers are required to lodge a deposit in the domestic currency equivalent—which is currently not remunerated—of up to 100% of the value of the LC (depending on the creditworthiness of the operator).
Documentation requirements for release of foreign exchange for imports
Preshipment inspectionYes.
Import licenses and other nontariff measuresImport licenses are automatically granted by the Directorate of External Commerce. All individuals and economic entities are permitted to engage in import activities.
Import taxes and/or tariffsThe customs tariffs consist of three rates: 5%, 10%, and 20%, with no zero-rate band, and specific consumer taxes are levied on refined petroleum products, motor vehicles, alcoholic beverages, beer, and tobacco.
Imports of petroleum products, alcoholic beverages, beer, cigarettes, and automobiles are subject to surcharges.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsAll export proceeds must be repatriated and collected through the commercial banks.
Financing requirementsNo.
Documentation requirements
Preshipment inspectionYes.
Export licensesFor statistical purposes, all exports require the completion of a registration form specifying the quantity and c.i.f. or f.o.b. value of the export.
Taxes collected through the exchange systemBanks charge a commission of 0.125% on the collection of export proceeds—with a minimum equivalent to $25 and a maximum of $300—when the LC is opened, and an additional commission of 0.125% is collected when funds are received. Banks also charge a postage levy of Db 39,000.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersCommercial banks charge a postage levy equivalent to $2 for clients ($4 for others) on all transactions.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsn.a.
Controls on credit operationsn.a.
Controls on direct investment
Inward direct investmentInvestments, excluding those related to the extraction of hydrocarbons and other mining industries, are permitted on the same basis as domestic investments.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsn.a.
Controls on personal capital transactionsn.a.
Provisions specific to commercial banks and other credit institutionsn.a.
Provisions specific to institutional investorsn.a.
Other controls imposed by securities lawsNo.
Changes During 2004
Exchange arrangementMarch 17. The central bank issued a regulation reestablishing foreign exchange auctions.
December 9. The first foreign exchange auction took place.

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