Chapter

Nonmember Countries

Author(s):
International Monetary Fund. External Relations Dept.
Published Date:
September 1956
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Argentina

Exchange Rate System

The official rate of the Argentine Peso is M$N 18.00 = US$1. This rate applies also to settlements in agreement dollars with those countries with which Argentina has bilateral agreements requiring payment in this way (see section on Prescription of Currency, below). Official rates are also published for French francs, Norwegian kroner, Portuguese escudos, Swedish kronor, and pounds sterling. Most transactions take place at the official rate, but the proceeds of certain exports are subject to a levy of 10,15, 20, or 25 per cent, according to the nature of the commodity exported. There is also a free fluctuating exchange market for invisibles and capital, through which certain trade transactions, including the settlement of exports and imports of gold bars and coins, may be negotiated, certain of the imports being subject to a surcharge of M$N 20 per US$1. (See Table of Exchange Rates, below.)

Administration of Control

The administration of exchange control is exercised by the Central Bank of Argentina in cooperation with the government trade authorities and through authorized banks and dealers. All transactions through the official market are controlled by the Central Bank.

Prescription of Currency

Payments must be made or received in the manner prescribed in the exchange control regulations. These requirements are in accordance with the terms of Argentina’s payments agreements with other countries and monetary areas; payments with many countries1 must be settled through accounts maintained in “clearing” dollars, unless the transaction is eligible for the free market, but transactions with Uruguay must be settled in “special account” dollars. All transactions with Peru and Switzerland and official market transactions with Spain must be settled in freely disposable U.S. dollars.

Imports and Import Payments

Imports listed as essential are paid for through the official market and require exchange licenses, which serve as authority both to import and to obtain the necessary exchange for payment. These licenses are granted according to the origin and the category of the imports. Individual import quotas are established for certain essential goods. Certain other listed items, including gold bars and coins, may be imported by registered importers and paid for through the free market, without an exchange license ; for a few of these the prior payment of a surcharge of M$N 20 per US$1 is required.

Payments for Invisibles

Payments abroad for commercial invisibles require licenses if they are to be effected at the official market rate. Otherwise, all payments for invisibles may be made freely through the free market. However, insurance for all imports must be made with domestic firms and paid in local currency. All payments to neighboring countries for freight may be made at the official market rate. Travelers may take out Argentine and foreign banknotes freely.

Exports and Export Proceeds

Some exports are controlled in order to take into account the requirements of the domestic market. Exchange proceeds of exports must be received in the appropriate currencies and surrendered. Exporters must receive the foreign exchange proceeds of their exports in the form of a payment order or an irrevocable letter of credit payable in Buenos Aires against shipping documents, at a time at least five working days after shipment. There are exceptions to these arrangements for exports to a small group of countries. A percentage of the f.o.b. value of all export proceeds may be paid abroad as exporters’ commissions.

Proceeds of listed exports must be surrendered at the official rate, but the proceeds of exports of the more important items are subject to the payment of a levy of 10, 15, 20, or 25 per cent, according to the nature of the goods. Proceeds of unlisted exports, including gold bars and coins, may be sold in the free market.

Proceeds from Invisibles

Exchange receipts from invisibles may be sold in the free market. Travelers may bring in Argentine and foreign banknotes without limitation.

Capital

Exchange derived from incoming capital may be sold in the free market. Investments abroad by residents may be made through the free market without a license.

Under Central Bank Circular No. 2324 of November 17, 1955, special facilities are given to foreign investors to import new machinery and any necessary raw materials, spare parts, etc. New incoming capital and interest thereon may be repatriated freely through the free market. Earnings accruing on foreign investments since June 30, 1955 may also be transferred through the free market. The remittance abroad of foreign capital and income thereon existing in Argentina before that date continues to be subject to exchange control.

Table of Exchange Rates (as at December 31,1955)(pesos per U.S. dollar)
BuyingSelling
13.50(Official Rate less 25% Levy)

Exports of greasy wool, dry and salted hides, timber. Re-exports.
14.40(Official Rate less 20% Levy)

Exports of scoured wool.
15.30(Official Rate less 15% Levy)

Exports of meat, most dairy produce, combed wool and tops, etc.
16.20(Official Rate less 10% Levy)

Exports of grains, oilseeds, other farm products, yerba maté, etc.
18.00(Official Rate)

Exports of ores and other mining products, tanned hides, yarns and threads, etc.
18.00(Official Rate)

Imports of goods and commercial invisibles entitled to the official rate.
35.50 (approx.) (Free Market Rate)

Proceeds of all other exports. Invisibles. Capital.
36.50 (approx.) (Free Market Rate)

Imports of goods permitted at the free rate. Income from foreign investments accruing since June 30, 1955. Other invisibles. Capital.
56.50(Free Market Rate plus M$N 20 Surcharge)

Imports of motor bicycles and spares for motor vehicles and for industrial and other machinery.

Changes during 1955

During the period January through September, numerous circulars were issued changing the exchange rates applied to payments for specified imports and the proceeds of specified exports.

January 17

By Decree No. 637, holders of foreign capital invested in Argentine industry and mining before August 26, 1953 and fufilling the purposes of Law No. 14222 of that date were given the right to remit or capitalize up to 8 per cent of liquid profits beginning from that date. Previously, foreign capital that entered Argentina before the passing of Law No. 14222 could be remitted only to the extent of 5 per cent per year and there was no guarantee of exchange for its payment.

July

Travelers entering Argentina could not bring in more than M$N 20,000 in Argentine banknotes. Travelers leaving Argentina could not take out more than this amount or its equivalent in foreign banknotes calculated at the free market rate.

October 27

The exchange system was radically revised. A single official rate of M$N 18.00 per US$1 replaced the previous official rates of M$N 5.00 and M$N 7.50. Most financial remittances could be carried out freely at free market rates. The proceeds of certain exports were made subject to surcharges of 25, 20,15, or 10 per cent payable to the National Economic Recovery Fund. Certain imports could be paid for at the official rate and others through the free market, some of the latter being made subject to a surcharge of M$N 20 per US$1. All restrictions on the movement of foreign and domestic banknotes were removed.

November 17

Central Bank Circular No. 2324 outlined the conditions under which foreign investment could be made in the form of imports of machinery, necessary raw materials, spare parts, etc.

November 28

New regulations governing nonresident accounts were promulgated. Earnings of foreign-owned capital payable after June 30, 1955, all nonresident funds derived from operations effected after October 27, 1955, and all funds held by residents of Bolivia, Brazil, Chile, Paraguay, and Uruguay were completely freed. The various types of nonresident account related to other countries were reclassified as “accounts existing at October 27, 1955.” These accounts were made transferable to other accounts of the same classification and were made available for purchasing securities on the Argentine stock exchange and for the expenses of the account holders in Argentina up to M$N 20,000 per month.

December 6

The exchange proceeds of fresh fruit exports could be negotiated at the free market rate, instead of at the official rate, as previously.

Irish Republic

Exchange Rate System

The Irish Pound is officially at par with the U.K. pound. Exchange rates for other currencies are based on the comparable London quotations.

Administration of Control

Exchange control is operated by the Department of Finance, whose permission is required before orders may be placed for goods originating outside the Sterling Area. Much of the authority for approving normal payments is delegated to commercial banks authorized for this purpose. Import licenses, where necessary, normally are issued by the Department of Industry and Commerce if the goods are of an industrial nature, or by the Department of Agriculture if the goods are agricultural in character. Import and export restrictions are administered by the Revenue Commissioners.

Prescription of Currency

The Irish Republic is one of the territories of the Sterling Area and payments to other parts of the Sterling Area may be made without formality. Payments for goods or services originating outside the Sterling Area may be made by paying (1) Irish pounds or sterling to a resident of the United Kingdom; (2) dollars, Irish pounds, or sterling through a bank to the account of a resident of the American Account Area or Canada, for goods or services originating in those countries ; or (3) non-dollar specified currencies,1 Irish pounds, or sterling through a bank to the account of a person resident outside the American Account Area or Canada, for goods or services originating outside those countries. The proceeds of exports to the American Account Area or Canada must be received in Irish pounds or sterling from the account of a resident of those countries, in Canadian dollars, or in U.S. dollars. The proceeds of exports to other countries outside the Sterling Area must be received in Irish pounds or sterling from the account of a resident outside the Sterling Area, or in any specified currency.2

Imports and Import Payments

Certain goods are subject to import prohibitions and others, regardless of the country of origin, are subject to quota restrictions on a global basis. Most goods, however, do not require individual import licenses. Whether or not an individual import license is required, permission must be obtained from the Department of Finance before orders may be placed for goods originating outside the Sterling Area. However, under a general exemption, residents may purchase freely certain items from the dollar area and almost all goods from outside the dollar area, provided that the goods are to be delivered within nine months of the order and that payment will be made in accordance with the regulations (see section on Prescription of Currency, above). For imports from the dollar area not subject to global quota restrictions, individual permission is at present granted automatically. Where exchange control authority, either general or individual, is held, the appropriate exchange or permission to credit a nonresident account is granted automatically.

Payments for Invisibles

Payments to other territories of the Sterling Area are not subject to exchange control unless they are for transactions outside the Sterling Area. Payments to persons resident outside the Sterling Area require approval, but there is a general authority covering the costs of transport, handling, and insurance of Irish imports and exports. Other payments for invisible transactions are authorized freely, except that there are limitations on payments to the dollar area for tourism and for film rentals. There is a basic allowance of exchange for tourist travel in non-dollar countries of £100 per adult for 12 months. Not more than £10 in Irish or U.K. notes may be taken out of the country to a destination outside the Sterling Area.

Exports and Export Proceeds

A system of export licensing is applied to a limited range of goods. Exporters of goods to outside the Sterling Area are required to obtain payment of the value of the goods in the manner prescribed in the regulations within six months of shipment. When payment is received in a specified currency (see footnote 2, above), the exchange must be sold to an authorized bank.

Proceeds from Invisibles

There are no specific requirements governing exchange receipts from invisibles, but if specified currencies are received they must be sold to an authorized bank. The import of U.K. banknotes through the post from outside the United Kingdom is prohibited. Travelers from the United Kingdom may bring in any amount of U.K. banknotes, but travelers from other countries may not bring in more than £10 in such notes. There are no limitations on the import of Irish banknotes, but if a large amount of such notes is carried, the traveler is liable to questioning by the customs, in view of the ban on the export of notes beyond a limit of £10.

Capital

All transfers of capital to territories outside the Sterling Area require exchange control approval, which is given only in exceptional circumstances to applications from Sterling Area residents. Incoming capital received in a specified currency must be sold to an authorized bank. Transactions in securities are controlled to ensure that capital is not transferred outside the Sterling Area in this way.

Changes during 1955

March 21

The amount of Irish or U.K. notes which could be taken out of the Irish Republic to a destination outside the Sterling Area was increased from £5 to £10 per traveler.

July 1

The Exchange Control Act 1954 came into force. The general exchange control procedures were not changed, except that holders of foreign currency securities and bearer securities were no longer required to deposit them with a bank.

October 1

The Italian lira was added to the list of specified currencies, i.e., those which could be used for settlements with non-dollar, non-sterling countries.

Liberia

Exchange Rate System

The Liberian Dollar is at parity with the U.S. dollar. U.S. currency is in circulation along with Liberian coinage in silver and copper. Official accounts are kept in dollars and cents. There are no restrictions on foreign exchange transactions.

Prescription of Currency

There are no obligations imposed on importers, exporters, or other residents prescribing the method or currency for payments to or from persons resident abroad.

Imports and Import Payments

There is no general system of import control. A few items require prior licenses.

Exports and Export Proceeds

Export licenses are not required, except for precious metals and precious stones. The surrender of the proceeds from exports is not required and exchange receipts are freely disposable.

Payments for and Proceeds from Invisibles

There are no limitations on payments for or receipts from invisibles. There are, however, restrictions on the circulation of U.S. banknotes in denominations over $20.

Capital

No exchange control obligations are imposed on capital receipts or payments.

Changes during 1955

No significant changes took place during 1955.

Libya

Exchange Rate System

The Libyan Pound is officially at par with the pound sterling. Exchange rates for other currencies are based on the London quotations.

Administration of Control

The Ministry of Finance is the authority which issues licenses for payments abroad. Import licenses are issued by the Departments of Trade in the three provinces of the United Kingdom of Libya, namely, Tripolitania, Cyrenaica, and the Fezzan.

Prescription of Currency

The United Kingdom of Libya, as one of the territories of the Sterling Area, conforms to the prescription of currency arrangements and the sterling payments system of the United Kingdom (see section on Prescription of Currency in the survey on the United Kingdom).

Imports and Import Payments

All imports are subject to license. Most commodities may be imported from EPU countries and their associated territories under open general license. Other imports are authorized according to a yearly program approved by the Government under a system of quotas and individual licenses directed toward restricting imports of luxuries in favor of essential requirements. The licensing policy is more liberal for imports from non-dollar countries than for imports from dollar countries. Exchange is granted for all authorized imports.

Payments for Invisibles

All payments for invisibles require licenses. These are granted for expenses incidental to trade transactions, but for other purposes the issuance of licenses is subject to administrative decision.

Exports and Export Proceeds

All exports require licenses, to ensure that the proceeds will be received in conformity with the prescription of currency requirements. All foreign exchange derived from exports must be surrendered. Goods imported against payment in dollars may not be re-exported.

Proceeds from Invisibles

Foreign exchange receipts from invisibles must be surrendered.

Capital

Transfers of capital abroad require licenses; incoming capital must be surrendered. Transfers of profits and for the repatriation of capital normally are approved.

Changes during 1955

No significant changes took place during 1955.

New Zealand

Exchange Rate System

The official rates for the New Zealand Pound in terms of non-sterling currencies are based on the fixed rate for sterling-N.Z. pounds and the rate for the currency concerned in the London market, maintained between the official limits. As at December 31, 1955, the trading banks’ rates for telegraphic transfers on London were £NZ 100/7/6 buying, £NZ 101/-/- selling, per £100, and for U.S. dollars they were $2.7982 buying, $2.7665 selling, per £NZ 1.

Administration of Control

Exchange control authority is given to the Minister of Finance, who, in accordance with the terms of the regulations, has delegated it to the Reserve Bank of New Zealand; however, much of the routine supervision is done by the trading (commercial) banks.

Prescription of Currency

New Zealand, as one of the territories of the Sterling Area, conforms to the prescription of currency arrangements and the payments system of the United Kingdom (see section on Prescription of Currency in the survey on the United Kingdom).

Imports and Import Payments

Most imports from “scheduled” countries,1 some imports from non-scheduled countries, and most imports of motor vehicles require import licenses. For permitted imports, exchange is made available in full. Payments for imports must be made in the manner prescribed in the regulations (see section on Prescription of Currency, above).

Payments for Invisibles

Payments for invisibles require the approval of the Reserve Bank. Payments to the Sterling Area are not restricted, except for travel allowances and a few minor items. An exchange allowance of £NZ 200 per adult per 12 months is granted for nonbusiness travel in non-sterling, non-dollar countries, and of £NZ 5 per day, with a maximum of £NZ 100, for nonbusiness travel in dollar countries. The remittance of profits, interest, and dividends earned by nonresidents is permitted freely, subject to formal approval by the Reserve Bank. Other remittances to countries outside the Sterling Area are treated on their merits, strict scrutiny being given to remittances to hard currency areas.

Exports and Export Proceeds

All exports require export licenses. These are issued by the Customs Department, provided that the transaction is being cleared through a trading bank through which the net export proceeds will be received in a manner conforming to the regulations (see section on Prescription of Currency, above) and that the foreign exchange will be surrendered to the banking system.

Proceeds from Invisibles

All receipts of non-Sterling Area currencies must be offered to the Reserve Bank; they may be sold to a trading bank in New Zealand, but they may not otherwise be sold or dealt in without permission. No control is exercised over the disposal of Sterling Area currency receipts other than from exports.

Capital

Transactions in non-sterling securities owned by New Zealand residents require the prior permission of the Reserve Bank. All outward capital remittances require prior approval. Capital receipts in non-Sterling Area currencies must be offered to or declared to the Reserve Bank. No control is exercised over the disposal of capital receipts by New Zealand residents in Sterling Area currencies.

Changes during 1955

At various times in 1955 items were added to the list of goods exempt from import licensing if imported from nonscheduled countries.

July 28

The Import Licensing Schedule for 1956 was announced. Certain of the relaxations it covered were to come into effect immediately (see July 29, below).

July 29

The list of items exempt from import licensing regardless of country of origin was increased by 41 items, making the total in this category approximately 150.

The listed goods that could be imported without an import license from certain non-dollar countries could now also be imported without an import license from Albania, Argentina, Bulgaria, French Somali-land, East Germany, Hungary, Iran, Poland, Rumania, Tangier, and the U.S.S.R.; i.e., these territories were removed from the list of “scheduled” countries.

September 27

It was announced that licenses for 1956 imports of cars and commercial vehicles from all sources would be one-third less than 1955 licenses.

October 29

Import licensing was reimposed on textile piece goods, including wool textiles, and on jams, jellies, marmalade, and preserves.

Portugal

Exchange Rate System

The parity of the Portuguese Escudo in terms of the U.S. dollar is Esc 28.75215 = US$1. The official rates are Esc 28.60 buying, Esc 28.95 selling, per US$1. Exchange rates are uniform.

Exchange Control Territory

Portugal and Portuguese overseas territories 1 constitute a single exchange control territory, the Portuguese Monetary Area. The exchange control regulations of Portugal are applied almost uniformly throughout the Portuguese Monetary Area, and current payments between its various territories are freely effected through controlled accounts.

Administration of Control

Exchange controls are administered by the Ministry of Finance and the Bank of Portugal, with the assistance of commercial banks authorized for this purpose. Trade control policy is the responsibility of the Commission of Economic Coordination in the Ministry of Economy and of the Council of Ministers ; a Directorate-General of Commerce in the Ministry of Economy administers trade controls. Import and export licenses are issued by the Department for Licensing Foreign Trade, operating within the Directorate-General’s office.

Prescription of Currency

Settlements on account of merchandise transactions and invisibles are effected in the currency and manner prescribed by the provisions of bilateral trade and payments agreements or determined on the basis of the country of origin or the destination of the goods and services involved. Any deviation from the general regulations in this matter requires the approval of the Bank of Portugal.

Imports and Import Payments

All imports are subject to registration, mainly in order to enforce the prescription of currency regulations. The presentation of the registration form to the customs enables the import to be cleared. Some imports from EPU countries and their overseas territories, imports from other than EPU countries payable in a currency of any EPU country, and most imports from other countries require individual licenses, which are issued with the registration forms. For certain listed goods from the dollar area, import licenses are issued automatically. Most goods valued at less than Esc 2,500 may be imported freely from EPU countries, their associated territories, and Spain. Appropriate exchange is granted automatically for authorized imports.

Payments for Invisibles

All payments on account of invisibles that are made in foreign currency or by crediting a nonresident account, and that exceed Esc 2,500, require individual licenses. For lesser amounts, such payments are made if the applicant undertakes to supply documentary evidence of the obligation, should proof be required later. Payments to countries with which Portugal has payments agreements are permitted freely within the terms of the related agreements. Payments in favor of residents of any EPU country are permitted freely, without any limitation on the amount, on account of costs incidental to exports and imports, and up to Esc 100,000 on account of various other categories of current payments. Travelers may take out any amount in Portuguese and foreign banknotes.

Exports and Export Proceeds

All exports are subject to registration, mainly in order to secure the enforcement of the prescription of currency and surrender regulations. Certain exports to any country and all exports to other than EPU countries payable in an EPU currency are subject to individual license. Export proceeds must be surrendered.

Proceeds from Invisibles

Payments from residents of EPU countries may be received freely by Portuguese residents on account of costs incidental to exports and imports, without any limitation on the amount, and on account of a variety of other categories of invisibles, up to Esc 100,000. The individual permit of the Bank of Portugal is required in all other cases. Exchange receipts from invisibles must be surrendered. Travelers may bring in any amount in Portuguese and foreign banknotes.

Capital

Transfers of capital to countries with which Portugal has payments agreements are permitted freely within the terms of the related agreements. Other capital transfers require specific approval. Exchange receipts from capital transactions must be surrendered.

Changes during 1955

March 12

Application of the provisions of Decree No. 38659 of February 26, 1952, requiring the blocking of a percentage of the proceeds of certain exports to EPU countries, was limited to a few export items and then only to the amounts exceeding certain quotas.

July 16

Application of the provisions of Decree No. 38659 of February 26, 1952, requiring the blocking of a percentage of the proceeds of certain exports to EPU countries, was suspended entirely.

August 6

A list was published of 110 commodities for which import licenses permitting imports from the dollar area would be granted freely. On the basis of dollar imports in 1953, the liberalization percentage was around 53.

Saudi Arabia

Exchange Rate System

The official government selling rate through the Saudi Arabian Monetary Agency is Saudi Riyals 3, qurush 16½, per US$1.1 The Saudi Arabian Monetary Agency fixes the value of the riyal in relation to foreign currencies and aids the Ministry of Finance in centralizing the receipts and expenditures of the Government. The commercial banks’ selling rate ranges from SR 3/16¾ to SR 3/17 per US$1. Open market buying is small and occasional. There are no restrictions on foreign exchange transactions, except that, if exchange is purchased from the Monetary Agency, only 5 per cent may be used by banks for purposes other than financing imports. Saudi Arabia is a signatory to the Arab League Payments and Customs Agreements.

Prescription of Currency

There are no obligations imposed on importers, exporters, or other residents prescribing the method or currency for payments to or from persons resident abroad.

Imports and Import Payments

There is no general system of import control. Imports are generally free of restriction, although a few products require prior licenses from the Ministry of Commerce. Imports of gold or of foreign notes and coin are subject to prior license by the Saudi Arabian Monetary Agency. Imports of Saudi Arabian silver or gold coin are prohibited except for small amounts of silver coin in border traffic.

Exports and Export Proceeds

The surrender of the proceeds from exports is not required and exchange receipts are freely disposable. Exports are generally free of restriction, but the re-export of imported goods is prohibited. Exports of gold or of foreign notes and coin are subject to prior license by the Saudi Arabian Monetary Agency. Exports of Saudi Arabian silver or gold coin are prohibited.

Payments for and Proceeds from Invisibles

There are no limitations on receipts or payments for invisibles. For conditions governing the export or import of currencies, gold, and silver, see the sections on Imports and Import Payments, and Exports and Export Proceeds, above.

Capital

No exchange control obligations are imposed on capital receipts or payments. There is, however, a Royal Decree that prohibits the export of capital and requires the repatriation of capital already abroad.

Changes during 1955

May

A Royal Decree forbade the export of capital and required the repatriation of capital already abroad. This decree has been implemented by a ruling that banks may use only 5 per cent of any exchange purchased from the Saudi Arabian Monetary Agency for purposes other than financing imports.

Spain

Exchange Rate System

The official basic rates for the Spanish Peseta are Pts 10.95 buying, Pts 11.22 selling,1 per US$1. The use of these rates is limited to government transactions ; a system of multiple exchange rates applies to commercial and private transactions. There is an official buying rate of Pts 21.90 per US$1 and three official selling rates, Pts 16.425, Pts 21.90, and Pts 25.00, per US$1. Other effective rates arise from combining certain percentages at one of these rates with the balance at a “free” official market rate, currently Pts 38.95 per US$1 (see Table of Exchange Rates, below). This rate has remained stable since September 1953.

Only authorized banks are permitted to operate on the “free” market, acting as intermediaries between buyers (who must have permits from the Spanish Foreign Exchange Institute) and sellers of specified currencies.2 As the demand for and the supply of “free” currencies are subject to the control exercised by the authorities over exchange transactions, the formation of “free” market rates is affected by the decisions of the Spanish trade and exchange control authorities and the intervention of the latter in the exchange market.

Exchange Control Territory

The Peninsular Territories of the Spanish State, the Canary Islands, the Balearic Islands, Ceuta, Melilla, the Spanish Zone of Morocco, and the Spanish colonies constitute a single exchange control territory, the Spanish Monetary Area.

Administration of Control

On a policy level, controls are administered by the Ministry of Finance, the Ministry of Commerce, and the Spanish Foreign Exchange Institute; on a technical administrative level, by the Spanish Foreign Exchange Institute, the General Department of Commerce and Tariff Policy in the Ministry of Commerce, and authorized banks.

Prescription of Currency

Settlements on account of merchandise transactions and invisibles are effected in the currency and in the manner prescribed in the provisions of bilateral trade and payments agreements,3 or determined on the basis of the country of origin or destination of the goods and services involved. The prescription of currency requirements are operated through a system of individual licensing, to which all categories of exchange payments are subject.

Imports and Import Payments

All imports require import and exchange licenses, which are issued in combined form by the Spanish Foreign Exchange Institute after consultation with the General Department of Commerce and Tariff Policy. Foreign exchange is made available for authorized imports through official allocations or the “free” market mechanism. Subject to the approval of the Spanish Foreign Exchange Institute, nonresidents may import essential materials and use the proceeds accruing from their sale for specifically determined expenses and investments in Spain. Specific industries grouped on a national or regional basis are permitted to make imports needed for production of their export goods out of their own retained exchange (see section on Exports and Export Proceeds, below).

Payments for Invisibles

All transfers abroad and payments by residents in favor of nonresidents on account of invisibles are subject to individual license. Practically all of them are effected at the “free” market rate. Persons traveling abroad may take with them a maximum of Pts 2,000 in notes of the Bank of Spain.

Exports and Export Proceeds

All exports are subject to individual licenses issued by the General Department of Commerce and Tariff Policy. This requirement is established mainly in order to determine the exchange rate applicable to the proceeds, and to enforce currency prescription and surrender regulations. Proceeds accruing from exports must be surrendered to authorized banks or sold through them on the “free” exchange market. However, in accordance with the arrangements called “Special Operations,” specific industries grouped on a national or regional basis are permitted to retain a percentage of their export proceeds to be used to pay for imported raw materials or other goods needed by them for their own production; in certain cases, special rates for specified exports are determined. There are altogether 12 “Special Operations” arrangements in existence, 7 of which have a regional applicability.

Proceeds from Invisibles

All exchange proceeds from invisibles must be sold on the “free” market if received in currencies dealt in on that market, or surrendered to authorized banks if received in other currencies. The “free” market rates are applicable to the purchase of proceeds accruing from practically all categories of invisibles. Persons may bring in a maximum of Pts 10,000 in notes of the Bank of Spain.

Capital

All outward capital transfers are subject to individual approval. All inward and outward private capital transfers must be effected at the “free” market rates. Special facilities are accorded to investments effected in Spain by nonresidents through the importation of essential goods (see section on Imports and Import Payments, above).

Table of Exchange Rates (as at December 31,1955)(pesetas per U.S. dollar)
BuyingSelling
10.95(Official Basic Rate)11.22(Official Basic Rate plus Commission)
Government payments, including imports of rationed foodstuffs.
16.425

Imports in Group A: coal and coke.
21.90(Special Export Rate)

Exports not listed in Groups 1-5.
21.90

Imports of eggs.
23.605(90% at Pts 21.90 and 10% at “Free” Official Market Rate)
Exports in Group 1: fresh fish, fruit trees, livestock, etc.
25.00

Imports in Group E: liquid fuels.
25.217

Imports of mechanic paste and newspapers.
27.015(70% at Pts 21.90 and 30% at “Free” Official Market Rate)25.435(60% at Pts 16425 and 40% at “Free” Official Market Rate)

Imports in Group B: phosphates.
Exports in Group 2 : almond oil, anchovies in brine, frozen fish, olives, apricots, etc.28.72(60% at Pts 21.90 and 40% at “Free” Official Market Rate)

Imports in Group C : seed potatoes.
30.425(50% at Pts 21.90 and 50% at “Free” Official Market Rate)
Exports in Group 3: aniseed, capers, clays and silicates, cocoa, cork manufactures, fresh and dried fruits, marble, canned meat, raw skins, tobacco products, fresh vegetables, etc.32.13(40% at Pts 2130 and 60% at “Free” Official Market Rate)

Imports in Group D : aluminum, aluminum oxide, bauxite, fertilizers, fibers, iron scrap, metallic ores.
33.835(50% at Pts 21.90 and 70% at “Free” Official Market Rate)
Exports in Group 4: anchovies in oil, cocoa butter, fruit juices, liqueurs and brandies, essential oils, vinegar, wine, etc.
37.245(10% at Pts 2130 and 90% at “Free” Official Market Rate)
Exports in Group 5: books, ceramics, chemicals, fresh flowers, paints, varnishes, perfumes, textiles, wolfram, etc.
38.95(“Free” Official Market Rate)

Invisibles. Capital.
38.95(“Free” Official Market Rate)

All other imports. Authorized invisibles and capital.
Note: The above rates apply to exchange receipts in the specified currencies.

Changes during 1955

July 18

Austrian schillings were quoted on the “free” market.

Switzerland

Exchange Rate System

The gold content of the Swiss Franc is established at 63/310 (= 0.20322 …) grams of fine gold.

The Swiss National Bank maintains the U.S. dollar rate in a free market between limits of Sw F 4.285 buying, and Sw F 4.46 selling, per US$1. The rate on December 31, 1955 was Sw F 4.285 per US$1. Exchange is controlled in respect of countries with which Switzerland has bilateral agreements or in respect of which Switzerland has enacted autonomous regulations. Bilateral agreements cover Switzerland’s trade and/or payments with 22 countries or monetary areas,1 and Switzerland controls its payments with 4 others.2 In accordance with the provisions of several of these payments agreements, official rates are applied to transactions covered by the agreements. This domain of regulated settlements is known as the sector of controlled payments. All settlements outside this sector (including those with all other countries) may be made freely at free market rates.

Switzerland participates with Belgium, Denmark, France, the Federal Republic of Germany, Italy, the Netherlands, Norway, Sweden, and the United Kingdom in a multilateral foreign exchange arbitrage arrangement, under which authorized banks in these territories may conclude spot transactions, and forward transactions for up to three months’ delivery, with other authorized banks in any of these territories. The spot exchange rates fluctuate between the official limits agreed by the exchange authorities of the countries concerned, while the forward premiums and discounts are left to the interplay of market forces. A fee of % of 1 per cent is charged on payments through the sector of controlled payments, and in addition there is a fee of ½ of 1 per cent on payments with other EPU countries to cover Swiss expenses resulting from membership in the EPU.

Exchange Control Territory

For all purposes of import, export, and payments control, the Principality of Liechtenstein is included in the Swiss customs territory for the duration of the treaty of March 29, 1923 between Switzerland and the Principality of Liechtenstein concerning the union of the Principality of Liechtenstein with the Swiss customs territory.

Administration of Control

The authority to impose measures for the control of imports, exports, and payments is vested in the Swiss Federal Council acting, as a rule, on the proposals of the Federal Department of Public Economy or the Federal Political Department. The Swiss National Bank is the executive authority in matters of currency, and the Swiss Compensation Office, together with the authorized banks, is entrusted with the operative part of payments control.

Prescription of Currency

The currency and manner of settlement on account of merchandise transactions and invisibles in the sector of controlled payments are prescribed in accordance with the provisions of the relevant payments agreements and/or by the Swiss regulations. In all other cases, settlements are not subject to regulations involving prescription of currency.

Nonresident Accounts

Nonresident accounts established and operated in accordance with bilateral agreements are controlled, but other nonresident accounts are free of control.

Imports and Import Payments

Certain goods are admitted into Switzerland on the basis of import licenses only; but in accordance with Switzerland’s present liberal import policy, licenses are, generally speaking, granted without quantitative limitation. However, quotas are established for certain agricultural products and, in the category of industrial products, for heavy motor vehicles and agricultural tractors. Imports from EPU countries are liberalized in accordance with the OEEC code of liberalization.

Settlements are effected automatically for authorized imports from countries to which the Swiss control regulations are applicable, i.e., the sector of controlled payments. Payments for imports from all other countries may be made freely through the free market.

Payments for Invisibles

Payments for invisibles may be made freely insofar as the application of bilateral agreements does not necessitate control over such payments. The export of Swiss and foreign banknotes is free.

Exports and Export Proceeds

The export (including re-export) of many goods is subject to export control through individual licenses. This export licensing system is operated in part with the assistance of appropriate trade organizations. In dealing with applications to export to countries with which Switzerland has payments agreements, the availability of sufficient funds under the relevant agreement is taken into consideration. Proceeds accruing from exports to controlled payment countries are converted into Swiss currency in observance of the existing regulations. Other export proceeds are freely disposable.

Proceeds from Invisibles

Proceeds from invisibles originating in controlled payment countries are converted into Swiss francs in observance of the existing regulations. The encashment of travelers’ credit documents issued in countries in the sector of controlled payments is limited to Sw F 1,500 per person per month. Proceeds from other countries are freely disposable. The import of Swiss and foreign banknotes is free.

Capital

Transfers of capital to or from countries in the sector of controlled payments require licenses if they are effected through the sector of controlled payments; however, transfers to such countries of capital not exceeding Sw F 500,000 do not require licenses. Transfers of capital to or from other countries may be effected freely.

Banknotes

Foreign banknotes are negotiated freely in Switzerland at rates determined by the interplay of supply and demand.

Changes during 1955

August 22

Italian lire and Italian authorized banks were included, for spot transactions, in the multilateral exchange arbitrage arrangements in operation among most Western European countries.

December 5

Italian lire and Italian authorized banks were included, for forward transactions for up to three months’ delivery, in the multilateral exchange arbitrage arrangements in operation among most Western European countries.

Austria, Belgium-Luxembourg, Bolivia, Brazil, Bulgaria, Chile, Colombia, Czechoslovakia, Denmark, Ecuador, Finland, Federal Republic of Germany, Hungary, Israel, Italy, Japan, Netherlands, Paraguay, Poland, Rumania, U.S.S.R., Uruguay, and Yugoslavia.

Non-dollar specified currencies are listed in the Irish regulations as Belgian francs, Congolese francs, kroner of Denmark and the Faroe Islands, deutsche marks, francs of the French Monetary Area, French Somali Coast (Djibouti) francs, Indo-Chinese piastres, Italian lire, Luxembourg francs, Netherlands, Netherlands Antilles, and Surinam guilders, Norwegian kroner, Portuguese escudos, Swedish kronor, and Swiss francs.

Specified currencies are those listed in footnote 1, together with Canadian dollars, Panamanian dollars, Philippine pesos, and U.S. dollars.

These countries are listed in the New Zealand regulations as follows : Bolivia, Canada, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Japan, Korea, Liberia, Mexico, Nicaragua, Panama, Philippine Republic, United States, and Venezuela.

The Azores, Madeira, the Cape Verde Islands, Portuguese Guinea, São Joâo Baptista de Adjuda, the Islands of São Tomé and Principe, Angola, Mozambique, Portuguese Indies (Goa, Damäo, Diu), Macao, and Portuguese Timor.

The riyal is divided into 22 qurush.

Pts 10.95 plus Pts 0.27 (banking commission of the Spanish Foreign Exchange Institute).

The currencies dealt in on the “free” market are as follows: Algerian francs, Austrian schillings, Belgian francs, Belgian Congo francs, Canadian dollars, Danish kroner, French francs, Italian lire, Mexican pesos, Moroccan francs, Netherlands guilders, Norwegian kroner, Portuguese escudos, Swedish kronor, Swiss francs, pounds sterling, and U.S. dollars; Egyptian pounds, Portuguese escudos, and Swiss francs in agreement accounts; pounds sterling in the “Iceland” account; U.S. dollars of account with Bolivia, Brazil, Chile, Colombia, Cuba, Finland, Greece, Italy, Mexico, Paraguay, and Turkey; and banknotes in Brazilian cruzeiros, Colombian pesos, deutsche marks, Peruvian soles, Uruguayan pesos, and Venezuelan bolívares. Deutsche mark checks, if marked “negotiable in Spain,” are also dealt in on the “free” market.

Spain has bilateral payments arrangements with Belgium-Luxembourg, Bolivia, Brazil, Chile, Colombia, Cuba, Denmark, Ecuador, Egypt, El Salvador, France, Federal Republic of Germany, Greece, Iceland, Italy, Japan, Mexico, Netherlands, Norway, Paraguay, Sweden, Switzerland, Turkey, United Kingdom, and Uruguay.

These are listed as Argentina, Austria, Belgian Monetary Area, Bulgaria, Czechoslovakia, Denmark, Egypt, Finland, French Monetary Area, Federal Republic of Germany, Greece, Hungary, Italy, Netherlands Monetary Area, Norway, Poland, Rumania, Spanish Monetary Area, Sweden, Turkey, United Kingdom and other territories of the Sterling Area, and Yugoslavia.

These are East Germany, Iran, Portuguese Monetary Area, and Uruguay.

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