Explanatory Note to Country Surveys

International Monetary Fund. External Relations Dept.
Published Date:
September 1969
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In Part II, individual surveys of the exchange systems of the member countries of the Fund, including three nonmetropolitan territories, are given. The exchange systems of three other countries which were not members of the Fund at the time this Report was written are also described.

In general, the surveys relate to the exchange systems as at the end of 1968. For a few countries the surveys relate to the exchange systems at a later date or include references to significant developments which took place early in 1969.

The description of an exchange system is not necessarily confined to those aspects involving exchange restrictions or exchange controls. As in previous Reports, questions of definition and jurisdiction have not been raised, and an attempt has been made to describe restrictive systems in their entirety, except for the tariff structure and, in most cases, direct taxes on exports and imports. Thus, the surveys include references to such features as import licensing, advance deposit requirements, import surcharges, travel taxes, export licensing, and export incentive schemes. Similarly, the section “Changes during 1968” may include references to certain developments that have a direct impact on international transactions but are not reflected in the body of the survey, such as major revisions of import tariffs or developments relating to regional cooperation.

A standardized framework has been employed in drafting the surveys: each system is described under similar headings, and each country survey contains a final section that lists chronologically the more significant changes which took place in the restrictive system during 1968 and, for a few countries, the early months of 1969. An indication of the subject matter to be found under these headings is given in the following paragraphs.

Under Exchange Rate System, the par value, where one has been agreed with the Fund, and/or the official exchange rates are given, the latter usually in terms of the U.S. dollar, together with a reference to other rates which may be essential to the country’s exchange rate system. In the surveys of certain countries with multiple exchange rate systems, further details are given in the Table of Exchange Rates (see below). The rates quoted are those effective on December 31, 1968, unless stated otherwise.

Under Exchange Control Territory, the extent of applicability of the exchange control is explained when it covers two or more sovereign or autonomous territories whose residents have common rights and obligations under the exchange control regulations.

Under Administration of Control, some indication is given of the authorities responsible for policy and administration of the controls and of the extent to which their powers are delegated for practical working purposes.

Under Prescription of Currency, the requirements affecting the selection of the currency and method of settlement for transactions with other countries are described. Where a country has concluded payments agreements with other countries or monetary areas, the terms of these agreements often lead to prescription of the currency for specified categories of payments to and from the countries concerned. The countries with which bilateral payments agreements are in force are listed either in the text or in a footnote. For a country whose currency has international importance, the prescription of currency arrangements involve the use of its own currency held by nonresidents in accounts with authorized banks. Payments to and from such nonresident accounts are then regarded as equivalent to settlements in foreign currency.

Under Nonresident Accounts, an indication is given of the manner in which the country regards the accounts in its currency of account holders not regarded as resident in that country, and the facilities and limitations attached to such accounts. Where there is more than one type of nonresident account, the nature and operation of the various types are described.

Under Imports and Import Payments, import licensing requirements are described briefly, and details are given of the additional requirements imposed on payments for imports and of any advance deposit requirements. The term “open general license,” which is used in some countries, indicates arrangements whereby certain imports or other international transactions are exempt from the restrictive application of licensing requirements, in contrast to an “individual license,” which may be either given freely, or restricted in its issue, according to administrative decisions. The expression “global quota” is employed in the sense that many countries now use it, to indicate quotas that are not necessarily universal in their application but instead may apply to a group of countries, e.g., global quotas for imports from countries in the European Economic Community.

Under Payments for Invisibles, action in the matter of permitting payments abroad for current transactions in invisibles is described briefly, together with any limitations on the export of foreign and domestic banknotes. For some countries that do not impose limitations on payments for invisibles, this section is combined with the section on Proceeds from Invisibles (see below).

Under Exports and Export Proceeds, the application of export licensing, where this is operative, is indicated, together with a brief outline of the requirements imposed on the proceeds derived from exports. The expression “exchange receipts must be surrendered” is used to indicate that the recipient is required by the regulations to sell his foreign exchange against local currency, usually at the official rate, to the central bank or to a commercial bank or exchange dealer authorized for this purpose. In some countries there is a requirement that the exchange be sold in a free market.

Under Proceeds from Invisibles, any conditions governing exchange derived from transactions in invisibles are given, and any limitations on the import of foreign and domestic banknotes are described.

Under Capital, a general indication of the special arrangements or limitations attached to international receipts and payments in respect of capital items is given. Where special arrangements for foreign capital also cover the income thereon, they are dealt with in this section rather than in the sections on Payments for Invisibles and Proceeds from Invisibles.

Under Gold, the principal provisions are summarized that govern the holding, negotiation, and import and export of gold coins and gold in other forms.

In the Table of Exchange Rates, which is provided for certain countries having a multiple currency practice involving more than two rate levels, the exchange rates effective on a specified date are given. For convenience, the data in these tables are in terms of local currency units per U.S. dollar. The tables include effective rates arising from the negotiation of percentages of the total exchange at different rates, the imposition of exchange taxes, the negotiation of exchange certificates, etc.

Under Changes during 1968, the more significant changes in the country’s restrictive system during 1968 are presented in chronological order. Important measures made effective in the early months of 1969 are indicated at the end of certain surveys or in footnotes to the text.

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