Appendix II Measures Affecting Members’ Exchange and Payments Systems, 1989–90

International Monetary Fund
Published Date:
January 1992
  • ShareShare
Show Summary Details
Imports and Import Payments
Quantitative Import Controls
Developing countries—fuel exporters
Venezuela5/24/89LiberalizationFirst stage of the Government’s new trade reform for manufacturing sector initiated. Licenses and prohibitions previously imposed on 1,899 items for protective purposes eliminated.
Developing countries—other
Brazil3/16/90LiberalizationAnnual import programming and the negative import list (ANEXO C) largely eliminated; the monopoly of federal government agencies to import products for reasons other than health, national security, and other specified public interests eliminated.
Burundi8/7/90LiberalizationRemaining quantitative restrictions on imports, notably on flour, gas bottles, cotton fabric, and pharmaceutical products, removed.
Guinea-Bissau2/1/89LiberalizationOpen general license (OGL) system introduced, under which most imports are allowed without restriction; the exceptions are petroleum and products on a negative list.
Mauritania5/17/89LiberalizationImport-licensing requirements abolished, and the requirements for obtaining an exporter-importer card liberalized; special import regimes for government entities and state enterprises introduced; and a system of special import authorizations for those not holding exporter-importer cards introduced.
Niger7/1/90EliminationSystem of import licenses abolished; all remaining quantitative import restrictions replaced by customs tariffs ranging from 2.3 percent to 71 percent.
Poland1/1/90EliminationLicensing requirements abolished for imports from the convertible currency area, except those for radioactive materials and military equipment.
Rwanda1990TighteningDuring 1990, foreign exchange shortages and military imports prompted the authorities to suspend normal import arrangements temporarily. At end of 1990, the central bank was authorizing civilian imports of a few commodities only (petroleum products, essential foodstuffs, pharmaceutical products, and selected spare parts).
Tanzania2/1/90 1989Elimination LiberalizationMaximum annual limit on imports per importer under the OGL abolished. OGL import facility expanded to include most recurrent inputs and share parts.
Uganda2/90IntroductionSpecial Import Program with revised negative list reintroduced. Importers no longer required to obtain prior approval from Bank of Uganda, but import licenses continue to be required.
Yugoslavia12/1/89LiberalizationEnterprises allowed to import directly raw materials, intermediate goods, and capital equipment necessary for their production; enterprises that are registered with commercial courts and are authorized to produce and sell specific goods in Yugoslavia are also permitted to import and export same goods and services.
12/22/89LiberalizationLBO import regime (conditionally free imports) eliminated; most goods that were subject to LBO licensing transferred to the LB regime (totally free imports).
Advance Import Deposits
Developing countries—fuel exporters
Ecuador1/24/89LiberalizationMerchandise imports purchased through the U.S. Commodity Credit Corporation exempted from prior import deposit requirements.
10/19/89LiberalizationRates for prior import deposit requirements (based on c.i.f. value of imports) for private sector imports lowered to between 45 percent and 120 percent.
12/12/89LiberalizationRates for prior import deposit requirements (based on c.i.f. value of imports) for private sector lowered further. Rates for public sector imports on same product categories set at one half the private sector rates. Importers obtaining financing for 90 days or longer (previously 120 days or longer) exempted from prior import deposit requirements. Requirement that some capital goods imports be financed with proceeds of loans from international organizations, governments, or their agencies abolished.
1/18/90IntroductionImporter required to confirm use of foreign exchange obtained for temporary imports of raw materials and inputs of production within 180 days; requirement also applies to importers who have effected imports under an import permit but have not presented bank guarantees or made prior deposits.
7/6/90IntroductionRequests for import payments for which permits were granted after July 9, 1990 required to be made 60 days in advance of foreign exchange sale; prior import deposit scheme abolished.
11/15/90LiberalizationCentral Bank issues letters of credit for public sector of up to 100 percent of the value of imports (c.i.f.) that are financed with loans from multilateral institutions or guaranteed by deposits at the Central Bank.
Developing countries—other
Afghanistan1/15/90ExtensionMinimum import deposit ratio reduced to 20 percent from 25 percent in respect of essential products and increased from a range of 25–50 percent to 30–60 percent in respect of other products.
Argentina7/20/90EliminationThree percent advance import deposit requirement abolished.
Bangladesh2/18/90IntroductionOne hundred percent advance deposit required against letters of credit issued for commercial imports under SEM scheme.
2/26/90IntroductionFifty percent advance import deposit required for industrial imports under SEM scheme. The margin on advance deposit required against letters of credit issues for commercial imports under SEM scheme reduced to 50 percent.
3/26/90LiberalizationRate of advance deposits for industrial imports under SEM scheme reduced to 25 percent.
11/5/90EliminationAdvance deposit requirement for industrial imports under the SEM scheme abolished.
Colombia5/31/89LiberalizationRate of advance exchange license deposit reduced from 95 percent to 85 percent of value of exchange license.
1/1/90LiberalizationImports of goods not subject to a prior import license exempted from exchange budget authorized by the Monetary Board.
Costa Rica12/15/89LiberalizationAdvance import deposit requirement (50 percent at the end of 1988) reduced in three stages to 1 percent.
12/12/90TighteningRatio of import deposit requirement raised from 1 percent to 30 percent.
El Salvador8/8/90EliminationTwenty percent guarantee deposits against advance payments for imports of goods and services eliminated.
1/1/89LiberalizationMaturity date of letters of credit for imports from outside Central America at the official exchange rate extended to 180 days from 90 days. This requirement was abolished on December 31, 1989.
7/31/89LiberalizationGuarantee deposits required for opening letters of credit eliminated.
12/4/89LiberalizationRequirement that letters of credit for imports in excess of $10,000 from outside Central America must carry a minimum maturity period of 180 days eliminated.
Jordan10/4/89TighteningAdvance deposits required for import letters of credit raised to the following rates: (1) 30 percent for raw materials, basic foodstuffs, and medicines that have no domestic substitute; (2) 70 percent for other goods; and (3) 60 percent for all imports into free zones.
Korea3/1/90EliminationAdvance import deposit requirement, ranging from 5 percent to 10 percent against usance or sight letters of credit abolished.
Nepal3/5/89LiberalizationRate of margin deposits for import letters of credit for development and construction materials, dairy products, writing paper, newsprint, agricultural products, medical equipment, and educational and scientific materials lowered from 30 percent to 20 percent and that for all other products lowered from 50 percent to 30 percent.
7/10/89TighteningAll payments for imports from India in Indian rupees required to be documented.
Pakistan1/8/90EliminationThirty percent mandatory minimum margin requirement for opening letters of credit abolished.
Peru1/11/90IntroductionNon-interest-bearing advance import deposit requirement imposed on imports subject to controlled (MUC) exchange rate. Deposit rate must equal 50 percent of import value and be lodged for 30 days. Imports financed with credits of over 90-day maturity exempted.
4/19/90TighteningImports made at the MUC exchange rate subject to advance payments authorization.
8/19/90EliminationNon-interest-bearing advance import deposit requirement abolished.
Sierra Leone12/15/89LiberalizationImports of all permitted products allowed without license.
4/25/90EliminationRequirement that letters of credit had to be established with a local commercial bank abolished.
Sri Lanka6/15/89TighteningCommercial banks required to impose a 100 percent advance deposit against letters of credit for importation of specified luxury goods.
Turkey1/1/89LiberalizationImports of investment goods for manufacturing industries exempted from import guarantee deposit requirement.
4/19/89LiberalizationImport guarantee deposit rate lowered to 12 percent, to 7 percent on May 1, and to 5 percent on June 1.
11/3/89LiberalizationAdvance import deposit requirement and import certification requirements abolished for some one thousand items on a “List of Investment Goods, Imports of Which Are to Be Encouraged Directly.”
Yemen Arab Republic3/1/89LiberalizationMargin requirements against import letters of credit abolished.
5/22/90LiberalizationCommercial banks authorized to buy foreign exchange both domestically and abroad and to hold up to 10 percent of foreign exchange purchased to effect import payments on behalf of Central Bank.
8/1/90LiberalizationCommercial banks authorized to open letters of credit for importation of most goods, provided such imports are self-financing.
Other Import Measures
Industrial countries
Iceland1/1/89LiberalizationAll goods permitted to be imported freely on a deferred payment basis up to three months if not guaranteed by a domestic commercial bank, savings bank, insurance company, or public investment fund.
Ireland1/1/90EliminationRequirement of prior approval from Central Bank to make payments to nonresidents to pay for purchases of goods abroad for sale abroad suspended.
Norway12/8/89LiberalizationRestrictions on periods with respect to payments for imports abolished. Licensing requirement on leasing of machinery and equipment abolished.
Spain5/29/89LiberalizationRequirement of bank domiciliation abolished.
6/1/89LiberalizationRequirement of import domiciliation removed.
Developing countries—fuel exporters
Algeria11/5/89IntroductionNew procedures requiring prior approval of financing arrangements for all imports financed with credits of more than 90 days introduced.
Ecuador2/14/90TighteningPublic sector imports for which the terms of payments would involve a maturity of longer than one year required to have prior authorization from Central Bank.
Trinidad and Tobago9/30/89LiberalizationTwelve product groups (including most agricultural inputs, some raw materials for manufacturing industries, and capital goods and spare parts) removed from foreign exchange allocation system for imports.
Developing countries—other
Argentina5/30/89TighteningControls on import payments introduced, leading to arrears on some payments to suppliers.
6/21/89TighteningPayments abroad exceeding $1,000 suspended.
7/10/89LiberalizationAccess to official foreign exchange for import payments and interest on private debt fully restored.
12/18/89LiberalizationMinimum financing period requirement eliminated.
Brazil9/21/90EliminationExternal financing requirements on certain imports eliminated.
Burundi10/4/90LiberalizationThe limit on import licenses approved by commercial banks raised from FBu 10 million to FBu 25 million.
Chile6/28/89EliminationImports valued at less than $50,000 exempted from the 120-day minimum financing requirement.
1/5/90LiberalizationMinimum import financing requirement (120 days) abolished.
Cyprus10/19/89LiberalizationAmount foreign exchange authorized dealers are permitted to sell for advance import payments purposes without prior approval increased from £C 500 to £C 2,000.
Egypt3/8/89TighteningSixty-five products put on list of goods for which letters of credit were not allowed to be opened.
Ethiopia10/22/89LiberalizationImports of personal effects and motorcars financed with foreign exchange balances held overseas liberalized.
Ghana1/14/89LiberalizationImport-licensing system abolished; importers only required to file import declaration form through the authorized banks for statistical purposes.
Guatemala10/25/89TighteningBank of Guatemala ceased to provide exchange rate guarantees for import letters of credit.
Honduras7/16/89TighteningUse of the Central Bank’s foreign exchange for imports of goods by private sector restricted to a specified list of products. Transferable Certificates of Foreign Exchange (CETRAS) generated by the exportation of goods can be used only for imports of products on a special list, travel expenses up to $2,500, and other specified expenditures. Products not included in the above-mentioned lists can be imported only on basis of self-financed arrangements.
3/3/90LiberalizationMaximum amount of foreign exchange that may be purchased for payments of imports and authorized services without prior authorization from Central Bank raised from the equivalent of $2,500 to $3,000.
7/27/90LiberalizationMaximum amount of foreign exchange that may be purchased for payments of imports of goods without prior authorization from Central Bank raised to $5,000.
9/3/90LiberalizationSelf-financed import mechanism abolished; import financing required to be channeled through the banking system, either with foreign exchange in the interbank market or with credits from abroad (except for financing through export advances and government credit agreements with external institutions).
Hungary3/1/89LiberalizationCommercial banks authorized to act as intermediaries for commercial-related foreign exchange transactions between the National Bank of Hungary and exporters/importers; a new regulation clarifying the application of the forint cover requirement for importers opening a letter of credit and specifying the list of imports exempt from the requirement issued.
3/14/89LiberalizationSoya flour and fishmeal added to the list of imports exempted from forint cover requirement under letters of credit.
India6/21/89LiberalizationAuthorized dealers permitted to open transferable letters of credit for imports of goods into India that would provide for transfer of interest from first beneficiary, on condition that second beneficiary is also a resident of the same country; if second beneficiary of the letter of credit is resident of another country, transfer would be permissible only if both countries are defined as the External Group and are not members of the Asian Clearing Union.
Israel1/5/89LiberalizationAmount of prepayments allowed for imports of equipment and machinery increased from 15 percent to 35 percent and for other imports from $50,000 to $100,000 but not to exceed 35 percent.
Jamaica11/1/90LiberalizationAuthority to process and make payments for private sector imports delegated to commercial banks.
Jordan10/8/89TighteningImports into free zones required to be settled in foreign exchange transfers from abroad.
Malawi8/14/89LiberalizationLiberalization of foreign exchange controls extended to the remaining 25 percent of raw materials, industrial spare parts, and intermediate goods, including most goods related to commercial transport and some consumer goods (including infant formula, toothpaste, soap, and razor blades).
4/2/90EliminationPrior foreign exchange approval requirement of the Reserve Bank of Malawi for several categories of nonindustrial equipment and related goods and a number of consumer products for which there is domestic competition was removed. (Effective January 10, 1991, the import liberalization program was completed, with restrictions limited to a small negative list, which covers certain luxury items.)
Malta1/1/89LiberalizationCentral Bank of Malta introduced new arrangements, to facilitate payment procedures for importation of goods.
7/29/89LiberalizationNumber of items for which import license is required was reduced, and quota-based import regime was replaced by a tariff-based system.
Morocco3/1/89LiberalizationRequirement to provide dirham deposits in connection with certain requests for foreign exchange abolished.
Mozambique10/5/89LiberalizationSystem of nonadministrative allocation of foreign exchange came into operation; initially, products eligible for automatic licensing included key inputs for garment and shoe industries and spare parts for freight carriers and public transportation.
5/14/90LiberalizationCoverage of system of nonadministrative foreign exchange allocation expanded; limits on amounts for each user removed.
10/31/90LiberalizationUnder regulations governing the secondary market for foreign exchange (MSC), importers allowed to purchase foreign exchange, provided that, for imports exceeding $500, licenses with notation “Covered by the MSC” were obtained.
Philippines1/31/90TighteningApplications for imports originating from the state trading countries required to be supported by import authorizations issued by Philippine International Trading Corporation.
Rwanda3/5/90LiberalizationImports of goods financed with foreign exchange obtained outside official channels permitted.
Somalia10/2/89LiberalizationLetters of credit for imports of essential goods (edible oil, flour, rice, and sugar) exempted from prior approval requirement.
6/1/90IntroductionDutch auction system introduced for sales of foreign exchange under Commodity Import Program.
Sri Lanka5/29/89TighteningImports of motor vehicles and motorcycles (whether on a commercial basis and whether or not exchange is involved) required to be made against letters of credit.
7/24/89LiberalizationImports of industrial raw materials and spare parts for machinery (not in commercial quantities), where value of full consignment would not exceed $500 (c.i.f. Colombo) exempted from requirement to establish letters of credit.
8/24/89TighteningAll letters of credit established for imports of motorcycles to be settled only against pro forma invoices indicating make, model, year of first registration, and cylinder capacity. Final commercial invoices must contain the same information.
Sudan7/2/89LiberalizationAll exceptions to ban on imports under “own resources” scheme and barter deals abolished, except for a few remaining legitimate barter trades.
6/25/90LiberalizationDuring a period of two months (ending 8/24), holders of free and special foreign exchange accounts permitted to use foreign exchange balances existing on 6/25/90 to finance imports of industrial inputs.
8/16/90ExtensionGrace period for use of foreign exchange accounts to finance certain imports extended by one month.
10/8/90LiberalizationHolders of foreign exchange accounts permitted to import industrial and agricultural inputs, car parts, and office supplies.
Turkey2/25/90LiberalizationPayments for imports allowed to be transferred through commercial banks in the form of either Turkish liras or foreign currencies in accordance with the agreement between buyer and seller.
Western Samoa10/1/89LiberalizationMinimum c.i.f. value of imports for which financing by a letter of credit is required raised from WS$10,000 to WS$15,000. Requirement of prior approval by the Central Bank for imports of capital equipment eliminated.
Zambia3/17/89LiberalizationImporters applying for “no-funds-involved” import licenses not required to reveal sources of foreign exchange.
11/7/90LiberalizationBank of Zambia issued a circular clarifying the procedures for imports of goods at the market exchange rate.
Exports and Export Proceeds
Export Licensing
Developing countries—other
Costa Rica6/5/89LiberalizationRequirement that export licenses be obtained from the Central Bank eliminated; instead, a single export form for simultaneous reporting of all foreign sales required.
Mali6/15/89LiberalizationAll export-licensing requirements abolished.
Sierra Leone12/15/89LiberalizationExport licenses, except for annual licenses for gold and diamond exporters, abolished.
Sudan6/28/90LiberalizationExport procedures were simplified, as follows: (1) exporters were required to submit copies of export contracts and the “EX” export form to a commercial bank, instead of the Bank of Sudan, for approval; (2) export proceeds must be repatriated to the domestic banking system within three months of the shipment date; (3) new procedures were introduced, regulating the allocation and retention of export proceeds, except for cotton and gum arabic.
Turkey6/13/89LiberalizationRequirements for export licenses eliminated.
Zambia9/4/90LiberalizationExport-licensing system liberalized, and export permits from Ministry of Commerce no longer required; instead, licenses issued automatically by the exporter’s commercial bank, except for goods on negative list, for which authorization by Ministry of Commerce continues to be required. Export procedures were simplified to a single Export Declaration Form.
Fiscal and Other Incentives
Developing countries—fuel exporters
Venezuela8/17/89LiberalizationFiscal credits for exports modified so as to be provided only for goods containing domestic value added of more than 30 percent; fiscal credits, consisting of a negotiable bond that may be used for tax payments, set at 30 percent (of f.o.b. value) for exports with domestic value added of between 30 percent and 90 percent, and at 35 percent for exports with domestic value added of more than 90 percent.
8/4/90LiberalizationTax incentive for exports, consisting of a negotiable bond that may be used for payment of taxes, reduced to 5 percent of the f.o.b. value for manufactured products and to 6 percent for agricultural products.
Developing countries—other
Bangladesh7/1/89TighteningSpecial export incentives introduced for toys, luggage, and fashion goods; electronic and leather products and frozen foods selected as priority export sectors. A cash subsidy in lieu of Export Performance Benefit would be granted to exports of jute goods at the rate (based on the f.o.b. value) of 10–20 percent.
9/4/89LiberalizationJoint ventures, other than the garment industry, located in Export Processing Zones (EPZs) were allowed to retain 70 percent of export earnings in a foreign currency deposit account and to convert remaining 30 percent at the secondary market (SEM) exchange rate and keep it in a bank account in domestic currency. Balances on domestic currency bank accounts may be converted into foreign exchange at the SEM rate for payments of imported goods. Retention rate for garment industry is 75 percent.
Bolivia5/12/89LiberalizationPeriod during which nontraditional exporters may claim customs duty rebate certificates extended from six months to one year from date of exportation.
Guyana3/31/89LiberalizationRetention ratios under foreign exchange retention scheme unified to 10 percent for exporters of all goods other than bauxite.
8/1/89LiberalizationRetention percentage under foreign exchange retention scheme for sugar industry raised to 15 percent.
2/23/90LiberalizationRetention percentage under foreign exchange retention scheme for major industry raised to 17.5 percent.
Honduras1/6/89LiberalizationProportion of CETRAS issued raised from 15 percent to 40 percent for traditional exports.
7/6/89LiberalizationProportion of CETRAS issued raised from 40 percent to 50 percent for all exports, and their transferability outside the banking system prohibited.
3/13/90EliminationFiscal incentives given to nontraditional exports through CEFEX (a freely negotiable tax credit certificate) abolished.
India4/1/89IntroductionA new Cash Compensatory Support Scheme introduced, providing for compensations of unrebated indirect taxes (on both final and intermediate stages of export production), which are not refundable under the Duty Drawback System.
6/1/89TighteningDuty drawback rates applicable to engineering products, certain chemical products, and various plastic products revised, and 16 new items added to the list eligible to receive drawback. Existing facility, under which reduced drawback rates are applied to certain exporters who receive benefits of advance license/passbook schemes, extended to a number of products.
Israel6/15/90LiberalizationRate of net compensation granted to exporters by Foreign Trade Risks Insurance Company (FTIC) reduced by 2 percentage points.
Jamaica11/1/90LiberalizationAmounts available under foreign exchange retention scheme for exporters of nontraditional goods allowed to be credited to a foreign currency account at a commercial bank, and permitted to be used for business transactions with supporting documentation.
Kenya6/16/89TighteningAn additional 451 goods made eligible to receive export compensation.
Nepal5/1/89TighteningTwenty-five percent cash subsidy on exports of jute hessian to countries other than India introduced.
8/3/89TighteningCash incentives ranging between 10 percent and 35 percent of value (f.o.b.) granted for a range of export products.
Pakistan7/1/90LiberalizationIncome tax exemptions of up to 75 percent (instead of 55 percent) allowed for certain exports of goods and services.
Peru2/1/89LiberalizationMaturity of CLDs (Freely Disposable Foreign Exchange Certificates) extended to 120 days from 90 days. If converted into domestic currency instead of used for imports, CLDs converted at MUC exchange rate on the date of conversion rather than at the MUC exchange rate prevailing on date of issue. CLDs made transferable to nonexporting parties. Imports paid with CLDs exempted from obligatory financing requirements.
3/1/89LiberalizationMaturity of CLDs lengthened to 180 days.
4/20/89LiberalizationPercentage of export proceeds allowed to be retained by exporters in the form of CLDs raised to 40 percent.
6/2/89LiberalizationPercentage of export proceeds retained by exporters in the form of CLDs raised to 50 percent.
6/21/89LiberalizationMaturity period of CLDs extended to 210 days.
9/30/89LiberalizationCLD retention rate raised to 55 percent; maturity period of CLDs lengthened to 270 days.
10/6/89LiberalizationExporters surrendering foreign exchange receipts can receive Foreign Exchange Certificates for 45 percent of f.o.b. value of their exports that can be converted into domestic currency at MUC exchange rate; CLDs for 45 percent of the f.o.b. value would be subject to the same regulations that had applied previously to CLDs; and CCs (Convertible Foreign Exchange Certificate) for 10 percent of the f.o.b. value that could be used to open foreign currency deposits and thereby to obtain foreign bank notes.
11/4/89TighteningPercentage of export proceeds that can be converted into CLDs lowered to 35 percent, and percentage of export proceeds that can be converted into CCs raised to 20 percent.
11/25/89TighteningMaturity period of newly issued CLDs shortened from 270 days to 180 days.
12/1/89TighteningMaturity period of outstanding CLDs maturing in 180–240 days limited to 180 days; nontransferable exchange certificate (FENT) credits would be disbursed in foreign exchange.
12/22/89TighteningMaturity period of CCs established at 60 days.
12/29/89LiberalizationExporters repaying their FENT obligations permitted to use export proceeds in the following order: up to 35 percent of export value (f.o.b.) in Foreign Exchange Certificates (at the MUC exchange rate); up to 35 percent of the export value in CLDs; and the remainder in CCs. Payments of interest and commissions permitted to be made with resources obtained through the free exchange market, CLDs, or CCs.
Poland1/1/90EliminationSystem of supplementary export incentives (tax relief, export subsidies, and preferential credits) abolished.
South Africa4/1/90IntroductionIncentive scheme for exporters introduced; payments to be based on local content of products, extent of processing involved, and movement in real effective exchange rate since 1979.
Turkey8/2/89TighteningTwo percent marketing premium based on export value in 1989 introduced for major exporters (foreign trade companies with exports of at least $100 million in 1988 that pledge to export at least $100 million in 1989). Premium to be paid from the Support and Price Stabilization Fund and administered by the Turkish Eximbank.
11/12/89TighteningLegislation establishing a 1 percent marketing premium similar to that established in August for major exporters passed. Premium to be available to exporters whose realized exports exceeded $10 million in 1988 and 1989.
Uruguay4/4/90LiberalizationAll regulations on refunding indirect taxes on exports abolished.
Yugoslavia4/1/90IntroductionA subsidy payment of 7 percent on net exports of goods and 3 percent on net exports of services introduced.
9/1/90TighteningSubsidy payment on net exports, which applies uniformly to monthly net exports of goods and services, raised to 10 percent.
12/31/90LiberalizationTen percent general export subsidy eliminated.
Zambia4/6/90LiberalizationProcedures for export retention scheme simplified, whereby requirement to convert amounts to be retained in kwacha until payment for import took place was abolished.
Export Taxation
Developing countries—other
Honduras9/20/90TighteningTemporary export tax of 9 percent on traditional products to be paid at customs, instead of at the time of foreign exchange surrender, was raised to 12 percent.
Rwanda12/14/90LiberalizationExport taxes were abolished on all commodities except coffee.
Special Credit Facilities
Developing countries—fuel exporters
Ecuador1/18/90LiberalizationCentral Bank authorized to purchase foreign exchange proceeds from exports for up to 90 days before actual export shipment, except for certain products.
3/2/90, 6/1/90, 7/6/90LiberalizationCentral Bank modified the authorization to purchase foreign exchange proceeds from exports for up to 210 days before actual export shipment, except for certain products.
Developing countries—other
Argentina7/10/89LiberalizationSystem of export prefinancing and a number of export promotion schemes suspended.
9/15/89LiberalizationVarious export incentives provided under Export Promotion Law of 1984 suspended under Economic Emergency Law.
El Salvador11/28/90EliminationGuarantee deposit requirement for temporary exports eliminated; guarantee deposit requirement for anticipated export receipts eliminated in respect of re-exports.
Malta1/1/90EliminationExport Stabilization Scheme, under which exporters received a subsidy on basis of appreciations of the Maltese lira and amount of local value added, abolished.
Myanmar4/1/89LiberalizationExport Price Equalization Fund, through which certain exports were subsidized, abolished.
Peru1/12/90LiberalizationPercentage of financing of FENT credits (subsidized credits for nontraditional exports) without advance accounts reduced from 90 percent to 40 percent.
4/1/90EliminationSystem of FENT credits without advance accounts abolished.
4/17/90LiberalizationFENT advance account credits for exporters to be disbursed in intis at free market exchange rate.
5/15/90IntroductionLine of credit in intis equivalent to about $20 million approved as working capital for exporters.
6/1/90EliminationSystem of FENT credits with advance accounts abolished.
Philippines10/9/90LiberalizationExporters permitted to have access to a U.S. dollar-based working capital credit facility of the Foreign Currency Deposit Units (FCDUs) of local commercial banks without prior central bank approval, subject to certain conditions.
Turkey3/1/89TighteningTurkish Eximbank established a $150 million facility to support exports of Turkish consumer goods to the former U.S.S.R. Credits are to be repaid in two years at a rate of 20 basis points over LIBOR; in July, an additional $150 million facility for nonagricultural exports was announced; the Turkish Eximbank announced the establishment of the Short-Term Whole Turnover Insurance Program, which is designed to promote exports of Turkish goods on credit by insuring Turkish exporters on market terms against commercial and political risks.
6/1/89LiberalizationMaximum term on Eximbank preshipment credits was raised from 120 days to 180 days, and interest charge on 90-day credits was lowered by 2 percentage points to 37 percent; the credit limit for individual firms was raised from LT 500 million to LT 4 billion.
7/89Tightening$100 million Eximbank facility for exports to Algeria was announced. (Utilization began in August.)
1/24/90TighteningPremium payments made from the Support and Price Stabilization Fund to exporters of some categories of items increased.
12/13/90LiberalizationExport premium payments to exporters of certain products from Support and Price Stabilization Fund amended, effective January 1, 1991, reducing number of products eligible to receive payments from 116 to 89.
Other Incentives
Industrial countries
Italy1/11/90LiberalizationDecree issued allowing residents to retain receipts of foreign exchange from sales of goods and services in Foreign Exchange Accounts without any time limit; previously, such balances had to be used for permitted transactions or sold to authorized banks within 120 days.
Developing countries—fuel exporters
Ecuador9/18/90LiberalizationPeriod of surrender requirements for foreign exchange proceeds from exports revised.
Iraq2/1/90LiberalizationExporters of goods, other than those manufactured by firms in the public sector, permitted to retain export proceeds in foreign exchange accounts with commercial banks for three years and to use them to pay for licensed imports.
Developing countries—other
Bangladesh3/31/90IntroductionExport cash subsidies introduced, retroactive to July 1, 1989 through June 30, 1990, in place of the Export Performance Benefit Scheme for certain nontraditional exports.
5/29/90TighteningCash Against Documents facility ceased to be provided to buyers of raw jute, and all exports of raw jute permitted only against irrevocable letter of credit.
5/31/90IntroductionTen percent cash subsidy granted to domestic producers of fabrics that are used to produce certain exported garments.
Chile7/9/90LiberalizationRepatriation period for export proceeds extended from 90 days to 120 days.
Colombia8/3/89LiberalizationPercentage that coffee exporters must either surrender without payment (in the form of untreated coffee) or pay to National Federation of Coffee Growers reduced from 35 percent to 5 percent of volume of excelso coffee that they wish to export (retención cafetera).
7/25/90LiberalizationPeriod of surrender requirements for proceeds from exports other than coffee changed to three months after the date of receipt of payment as declared by the exporter.
7/25/90EliminationSystem by which Bank of the Republic retained a portion of exchange proceeds surrendered by the exporter of any product to repay debts on imports under the Vallejo Plan eliminated.
Dominican Republic4/13/89LiberalizationExporters given until June 30, 1989 to surrender foreign exchange receipts to the Central Bank.
8/30/90TighteningSystem of surrender of foreign exchange to Central Bank by exporters of goods and services tightened.
El Salvador7/25/89LiberalizationSurrender requirement for export proceeds from cotton and sugar abolished.
Ghana4/28/89LiberalizationNew procedures for repatriation of retained export earnings introduced, under which foreign exchange entitlements would be credited to the exporters’ foreign exchange accounts with banks located in Ghana.
Haiti7/7/89TighteningAll export proceeds and foreign exchange receipts by maritime agencies and nongovernmental organizations required to be surrendered to commercial banks, which, in turn, would transfer these receipts to central bank; exchange houses also required to surrender all transfers received from abroad to central bank.
10/9/89LiberalizationFifty percent of foreign exchange surrendered to be returned to commercial banks, and commercial banks required to return to exporters 15 percent of foreign exchange they received.
1/10/90LiberalizationSurrender requirements reduced to 40 percent and 20 percent for export proceeds and private transfers, respectively.
Honduras9/20/90IntroductionExplicit fines and penalties for delays in surrender of export earnings and underinvoicing of exports imposed; Central Bank empowered to verify and adjust price declared by exporters for purposes of foreign exchange surrender.
Hungary10/1/89TighteningNational Bank of Hungary stopped converting into forint transferable rubles earned on exports outside the scope of negotiated bilateral quotas; transferable rubles earned on these exports were, however, allowed to be traded freely with other enterprises willing and able to acquire imports outside the quota system.
Israel2/1/89TighteningPremium rate under the Foreign Trade Risks Insurance Company (FTIC) changed to 4.1 percent.
7/1/89TighteningPremium rate under FTIC changed to 4.9 percent.
Madagascar12/29/89TighteningExport proceeds of enterprises operating in Industrial Free Zone permitted to be repatriated within maximum period of 190 days, instead of the normal period of 90 days, from date of shipment.
Mauritania1/23/89LiberalizationCertain enterprises allowed to retain 25 percent of export proceeds on foreign exchange accounts maintained at domestic banks.
Mozambique2/28/89TighteningRetention rates for exporters of most traditional products reduced, with some retention privileges discontinued for 1989; average retention rate declined from about 50 percent in 1988 to about 40 percent in 1989.
1/1/90LiberalizationRetention rates for exporters of most products and certain services renewed, with some minor changes; average retention rate remained about 40 percent.
Peru4/19/90TighteningPeriod for surrendering export proceeds to Central Reserve Bank shortened to five calendar days from the day of receipt of payment.
Philippines4/26/89TighteningEach export shipment (except for shipments of household and personal effects) required to be covered by Export Declaration (without Foreign Exchange Proceeds) issued by an authorized agent bank, and approval of Central Bank Export Department required prior to shipment, except for certain categories.
Poland3/14/89LiberalizationEnterprises given 14 days to resell to foreign exchange banks portion of export proceeds that may not be retained under surrender regulations.
1/1/90TighteningRevised Foreign Exchange Law came into effect; export proceeds required to be surrendered fully to domestic banking system although enterprises allowed to retain previously accumulated foreign exchange held in “ROD” accounts.
Sierra Leone3/1/89LiberalizationUnder more liberal policy on exportation of gold and diamonds, licensed exporters of diamonds can retain 40 percent of proceeds from exports. Exporters of agricultural and marine products required to open letters of credit at Bank of Sierra Leone, which would ensure that 40 percent of export proceeds would be transferred to commercial banks in Sierra Leone and 60 percent would be retained at Bank of Sierra Leone.
4/25/90LiberalizationAmount of foreign exchange earnings from exports required to be surrendered to Bank of Sierra Leone reduced.
Somalia7/1/90LiberalizationSurrender requirement for foreign exchange earned by exporters of non-traditional goods reduced to 30 percent.
Tanzania4/1/89LiberalizationMaximum retention rate for nontraditional exports set at 35 percent, and retention privileges for traditional exports abolished.
Thailand5/8/89LiberalizationLimit on value of foreign currencies that may be retained by nonbank public raised to B 50,000 a day, provided that they are earned from border exports of rice.
12/8/89LiberalizationLimit on value of imports and exports that do not require filing of Exchange Control Form 21 or 61 increased from B 50,000 to B 100,000.
Tunisia4/14/89Liberalization“Professional accounts” in foreign currency established for industries exporting more than 15 percent of output (except in chemical or energy sectors); these accounts were permitted to be credited with 20 percent of retained export earnings and allowed to be used to finance expenditures abroad, including imports of goods and services and foreign investments.
Turkey8/11/89LiberalizationSurrender requirement lowered from 80 percent to 70 percent, with maximum period allowed for the surrender of 180 days from date of export shipments.
10/1/89LiberalizationTransfer requirement for commercial banks for receipts of foreign exchange lowered from 23 percent to 22 percent. (On November 2, requirement was further lowered to 20 percent.)
10/28/89Liberalization“Special Export Rediscount Credits Program” would be phased out and replaced by the “Foreign Trade Capital Companies Rediscount Credit Program.” The new program was virtually identical to previous program, except that subsidized credits, which were equal to 5 percent of export value of previous 12-month period, carried a maturity of only 90 days.
Uganda3/7/89LiberalizationExport-retention scheme for agricultural exports extended to all commodities other than coffee.
Yugoslavia1/1/90TighteningLiquidation of export proceeds from sale of goods and services with respect to clearing account operations limited to actual payments for imports of goods and services.
Zambia9/20/90LiberalizationPeriod during which exporters required to utilize retained foreign exchange earning extended from three months to six months.
State Trading
Developing countries—fuel exporters
Indonesia9/22/89LiberalizationMonopoly of Board of Logistics on imports of maize revoked.
Developing countries—other
The Gambia2/20/90EliminationMonopoly of Gambia Produce Marketing Board on exports of groundnuts abolished.
Guinea-Bissau4/1/89LiberalizationState import monopoly on cereal abolished.
Lao People’s Democratic Rep.7/10/90LiberalizationMonopoly of public sector on exports, except for logs and minerals, abolished.
Liberia3/1/89TighteningLiberia National Petroleum Company granted monopoly right to import petroleum.
Peru3/31/89LiberalizationPublic sector monopoly on importation of rice ended.
6/13/89LiberalizationPublic sector monopoly on exportation of rice ended.
Poland1/1/90LiberalizationAlmost all trade with CMEA countries conducted at world market prices and settled in convertible currencies; a limited volume of trade would continue to take place in transferable rubles through end of March 1991.
Sao Tome and Principe6/18/90LiberalizationMonopoly of ECOMEX over imports of basic foodstuff abolished, and private traders authorized to import and export all goods, except fuel, medicines, and those that are specified on a negative list.
Somalia1/10/89LiberalizationState trading monopoly on exports of hides and skins and myrrh was abolished.
Sri Lanka4/15/89LiberalizationState monopoly on importation of rice was abolished.
Syria1/29/89LiberalizationImports of paper and iron and steel products by the private sector were permitted.
Current Invisibles
Foreign Exchange Allocations for Travel, Medical Treatment, Studies Abroad, and Family Maintenance
Industrial countries
Greece12/29/89LiberalizationExchange allowance for personal travel increased from the equivalent of ECU 840 to ECU 1,000 a person a trip to EC member countries, and from $600 to $700 a person a trip to other countries.
9/20/90LiberalizationExchange allowance for personal travel increased from the equivalent of ECU 1,000 to ECU 1,200 a trip.
Ireland4/1/90LiberalizationAuthorized dealers delegated authority to sell foreign exchange in excess of basic allowance for travel equivalent to £Ir 1,200, with provision of documentary evidence that foreign exchange is for genuine travel purposes.
Italy3/10/89LiberalizationAmount of checks residents traveling abroad may write against their domestic bank accounts was increased from Lit 5 million to Lit 10 million.
Portugal3/28/89LiberalizationRestrictions on the acquisition of foreign currency by residents liberalized; tourist travelers allowed to take abroad an amount equivalent to up to Esc 100,000.
3/9/90LiberalizationThreshold limit for requirement on resident travelers to document regular acquisition of foreign currency raised from Esc 500 million to Esc 1 billion.
Developing countries—fuel exporters
Iran, Islamic Republic of12/7/89LiberalizationAnnual travel allowance of up to $300 a person granted, irrespective of the purpose of travel and destination, at “service” exchange rate.
Developing countries—other
Bangladesh9/12/89LiberalizationForeign exchange allowances for business travel abroad by exporters increased to range of $4,000-$150,000 depending on size of export companies.
10/18/89LiberalizationCeiling of £ stg. 200 a month on remittances for family maintenance purposes by foreign nationals working in Bangladesh eliminated.
11/18/89TighteningAllowance for personal travel by resident Bangladesh nationals to countries other than Bhutan, India, Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka established at $1,500 a year, subject to maximum of $600 a visit.
8/20/90TighteningForeign exchange allowance for travel by Bangladesh nationals to countries other than Bhutan, India, Maldives, Myanmar, Nepal, Pakistan, and Sri Lanka reduced to $1,200 a person a year, subject to a maximum of $500 a visit; allowance for travel to these seven countries reduced to $300 a person a year, with separate limit of $125 a person a year for travel to India by surface.
Brazil1/9/89LiberalizationLimit on foreign exchange allowance for travel increased to $4,000 irrespective of destination, and purchases and sales of foreign exchange made at freely determined exchange rate.
1/9/89TighteningRepurchases of foreign exchange by a foreign traveler limited to $100 a trip or to the dollar equivalent of amount exchanged into domestic currency during visit, whichever is smaller.
Burundi5/1/90LiberalizationDaily foreign exchange allowance for business travel increased from $165 to $200 a trip.
Chile10/18/90EliminationRequirement that foreign exchange for travel allowances be obtained no earlier than 20 days before departure date abolished.
Colombia10/5/90LiberalizationLimits on foreign exchange purchases for travel abroad increased; prior authorization by ICETEX for purchases of foreign exchange for study purposes eliminated.
Cyprus10/7/89LiberalizationMaximum annual allowances for subsistence purposes granted to residents studying abroad increased as follows: for Western European countries, excluding Greece, to £C 3,500; for Greece, to £C 2,200; for Canada and United States, to £C 5,000; for Eastern European and Middle Eastern countries, to £C 2,000; and for all other countries, to £C 3,000.
4/17/90LiberalizationUse of credit cards for business travel liberalized. In addition to settlement of hotel, restaurant, and transport expenses, credit cards permitted to be used to obtain from an authorized dealer up to £C 100 a trip for car rentals and for any other purpose up to £C 300 a trip; credit cards permitted to be used for payments of up to £C 300 for mail orders of books or other items by enterprises.
El Salvador7/31/89LiberalizationGuarantee deposit requirement for foreign exchange applications for travel abroad eliminated.
Hungary11/1/89TighteningLimit on rubles that travelers from the U.S.S.R. were allowed to convert into forint reduced from 30 rubles to 10 rubles.
11/3/89TighteningProvision of foreign exchange allowance for private travel suspended.
11/20/89LiberalizationTravel allowance for adults established at $50 a year; drawings allowed annually only to the extent of unused previous annual allowances; bonus of $50 or $100 granted if allowances were not drawn until third or fourth year, respectively; those who used up more than one half of total available under previous system not eligible for new allowances until 1991–92, respectively; amount of additional allowance for the purchase of railway tickets for any three-year period remained unchanged (Ft 15,400), but portion available in foreign exchange for purchase of gasoline abroad was abolished except for the handicapped.
12/13/89TighteningConversion of rubles into forint by travelers from the U.S.S.R. prohibited.
Israel6/15/90LiberalizationExchange allowance for the following purposes increased: (1) for tourist travel, from the equivalent of $2,000 to $3,000 a person a trip; (2) for family maintenance or gift remittance, from the equivalent of $1,000 to $2,000 a year; and (3) for education, from the equivalent of $500 to $1,000 a month.
Jamaica10/17/89TighteningMaximum period for which commercial banks are authorized to issue business travel allowance to each traveler reduced to five days in each calendar month. Applications for funds for trips of more than five days processed by Bank of Jamaica.
Kenya8/16/89LiberalizationBasic travel allowance for resident adults holding round-trip tickets was increased from K Sh 4,000 to K Sh 10,000 a person (and for children aged 3 to 12 years, from K Sh 2,000 to K Sh 5,000), but allowance to be granted once every three years instead of every two years; daily business travel allowance increased from K Sh 1,500 to K Sh 2,500 for a maximum of 20 days once every two years; those engaged in export trade to be able to apply for allowance more frequently than normal two-year limit; allowance for emigrants increased from K Sh 2,000 to K Sh 5,000 a person.
Korea1/1/89TighteningLimit on amount of foreign exchange that may be brought into Korea without registration reduced from $5,000 to $3,000, and limit on conversion of foreign exchange into won by nonresidents reduced from $20,000 to $10,000 a visit.
12/1/89LiberalizationLimit on amount of foreign exchange that may be brought into Korea without registration raised from $3,000 to $5,000, and limit on conversion of foreign exchange into won by nonresidents was raised from $10,000 to $50,000 a visit.
Lesotho6/11/90LiberalizationLimits on basic annual exchange allowances increased.
9/25/90LiberalizationSettling-in allowances immigrants are permitted to transfer through the “financial rand” were increased from M 100,000 to M 500,000 a family and from M 50,000 to M 250,000 a person (unmarried).
Mauritius6/23/89LiberalizationBasic business travel allowance raised from £ stg. 120 to £ stg. 200 a day, and personal travel allowance raised from £ stg. 1,200 to £ stg. 2,000 a person every two years; residents holding international credit cards permitted to use cards to pay for travel expenses exceeding approved travel allowances, subject to payment of a charge of 15 percent; charge would be exempt, however, if traveler provided documentary proof to central bank that expenses exceeding approved limits represented bona fide travel expenses.
7/1/90LiberalizationPersonal travel allowance for every two years raised from the equivalent of £ stg. 2,000 to £ stg. 4,000, and limit on basic business travel allowance, previously £ stg. 200 a day, eliminated.
7/1/90EliminationPrior approval by Bank of Mauritius no longer required for transfers by commercial banks of funds for educational purposes.
7/1/90LiberalizationLimit on cash gift remittance abroad raised from the equivalent of Mau Rs 1,000 to Mau Rs 5,000 a person a year.
Morocco7/30/90LiberalizationMaximum foreign exchange allowance granted for tourist travel by residents raised from DH 100 to DH 1,000 a person a year.
Mozambique10/31/90LiberalizationIndividuals permitted to buy foreign exchange in secondary market for foreign exchange (MSC) for expenses associated with travel for educational, scientific, and cultural visits, and medical treatment up to limits prescribed in MSC regulations; a limit of $2,000 a year set for other travelers; remittances for education abroad limited to $300 a month.
Nepal7/10/89LiberalizationPayments to India in Indian rupees required to be documented; for education, Rs 15,000 permitted at beginning of school year, with additional amounts to be granted upon submission of documentary proof; for pilgrimage, Rs 10,000 a person to be allowed; for business travel, Rs 15,000, and for other travel, Rs 5,000 to be granted initially and additional amounts to be granted upon submission of documentary proof of need; visitors to India to be granted Rs 2,000; application no longer required for requests up to Rs 500.
Pakistan1/18/89LiberalizationMaximum amount of tuition fee allowed to be remitted to educational institution abroad (£ stg. 6,178 a year to United Kingdom and $9,500 a year to other countries) lifted.
4/18/89LiberalizationCeilings on remittances abroad for advertisement fees in newspaper and magazines by nonexporters, for membership fees for educational, technical, professional, and scientific institutions, for membership fees of bona fide social clubs, and for fees for taking part in examinations held in Pakistan by I.C.W.A. London Institute of Bankers raised from PRs 2,000 to $250, from PRs 2,000 to $250, from PRs 300 to $50, and from PRs 1,000 to $150, respectively.
7/20/89LiberalizationAuthorized dealers allowed to convert into foreign exchange unspent amount up to PRs 500 left with foreign tourists out of proceeds of foreign exchange encashed by them in Pakistan.
Poland3/15/89TighteningForeign exchange at official rate ceased to be provided for travel abroad, and 200 percent surcharge on the provision of convertible currencies for that purpose abolished.
Romania4/26/90LiberalizationTravel allowance set at $75 a person every two years (one half of this amount for children), plus $30 for those traveling by car; residents allowed to purchase with lei railroad tickets to anywhere in Europe once a year; and in exceptional cases, a second trip to be allowed; travel allowance to CMEA countries raised to lei 3,000 a person a year.
Rwanda12/1/89TighteningDeclaration of foreign exchange on entering country made obligatory.
Sierra Leone4/25/90LiberalizationApplications for basic travel allowance in excess of $1,000 a trip not required to be approved by Bank of Sierra Leone.
Sri Lanka1/27/89TighteningApplications for foreign exchange allowances by business travelers in the form of foreign credit cards subject to review by the Central Bank.
4/5/89TighteningForeign exchange allowance for travel for employment purposes reduced to £ stg. 100.
Sudan2/7/89TighteningAllowance for travel to Egypt was reduced from 500 clearing dollars a year to 100 clearing dollars a year.
7/2/89TighteningLimit of $50 a person a year established for purchases of foreign exchange from commercial banks for travel purposes, with proof of airline ticket purchase.
9/27/89TighteningLimit of LSd 810 in clearing dollars a person established for travel to Egypt.
Thailand12/8/89Liberalization(1) Limit on amount of domestic currency notes an individual may take out of country without approval (except to the Lao People’s Democratic Republic) increased to B 10,000; limit applicable to the Lao People’s Democratic Republic set at B 100,000.
(2) Amount of foreign exchange authorized banks are allowed to purchase from individuals without submission of Exchange Control Form 71 increased from the equivalent of $500 to $1,000.
(3) Authorized banks permitted to sell foreign currencies for a bona fide transaction up to limit of $500, or its equivalent, without submission of supporting evidence and Exchange Control Form 31; previous limit was $140 a transaction.
(4) Authorized banks allowed to sell foreign exchange up to limit of $5,000 a year for remittances of family maintenance expenses and savings by expatriate workers (the same limit would also apply to a Thai national on pilgrimage to Mecca); previous limit was $200 a month for transfers to Europe and United States and $150 to other countries.
(5) Authorized banks empowered to approve applications for foreign exchange purchases for registration fees for training, seminars, or employment training abroad, application fees for employment abroad, and service fees for international telecommunication.
(6) Authorized banks permitted to approve automatically Exchange Control Form 51 for exchange of foreign currency held by foreign travelers into other foreign means of payment or into another currency, provided that amount does not exceed $3,000 or its equivalent at prevailing exchange rate.
5/22/90LiberalizationMaximum limit on foreign exchange commercial banks allowed to provide without verification increased as follows: (1) all travel expenses from equivalent of $9,000 to $20,000; and (2) travel expenses to Mecca, from equivalent of $5,000 to $50,000 a year.
Turkey2/25/90LiberalizationLimit on amount of foreign currency notes Turkish residents allowed to take out when traveling abroad raised from the equivalent of $3,000 to the equivalent of $5,000; residents allowed to take out foreign currency notes in excess of $5,000 or its equivalent, provided they purchase foreign currency notes from banks or special finance institutions in Turkey.
Zambia9/14/90LiberalizationForeign exchange to pay for the following service sold at the market exchange rate: (1) travel abroad other than for medical or educational purposes; (2) inducement allowance gratuities for expatriate workers; and (3) subscription payments.
12/3/90LiberalizationForeign exchange for education and medical treatment abroad sold at the market exchange rate.
Outward Transfers or Payments for Services Rendered by Nonresidents
Industrial countries
Portugal5/2/89LiberalizationLimits on payments to countries with which Portugal does not maintain special clearing arrangements increased from the equivalent of Esc 7.5 million to Esc 30 million a transaction.
9/8/89LiberalizationRegistration of contracts on technology may be made with the Bank of Portugal within one month of their conclusion but must always be made before the realization of foreign exchange.
Developing countries—other
Brazil7/1/89TighteningInterest payments accrued on medium- and long-term external debt owed to nonresident commercial banks subject to retention at Central Bank.
7/3/89TighteningRemittances of profits and dividends subject to retention at Central Bank.
10/5/89TighteningDividends of foreign companies permitted to be remitted abroad only after being retained at Central Bank for 60 days (this period extended to 120 days, effective January 10, 1990).
Burundi5/1/90LiberalizationProportion of net annual income of foreign nationals residing and working in firms that export at least 50 percent of their production raised to 70 percent.
Ghana2/1/89LiberalizationAll bona fide transfers of profits and dividends made eligible for funding through foreign exchange auction market.
4/27/90EliminationRestrictions on remittances of income of non-Ghanaians eliminated.
Honduras9/3/90LiberalizationMaximum amount of foreign exchange allowed to be purchased without prior authorization from Central Bank for services increased from $3,000 to $5,000 if purchased in newly created market for services.
Israel4/19/89LiberalizationRate of value-added tax on payments for services reduced from 15 percent to 7.5 percent.
9/1/89LiberalizationValue-added tax on payments for services, except tourism, eliminated.
Madagascar12/28/89LiberalizationTransfer of dividends and profits to nonresident shareholders unrestricted under the terms of Investment Code and Industrial Free Trade Zone.
Morocco2/22/90EliminationPrior approval for payments abroad for foreign technical assistance no longer required for amounts less than DH 50,000, and such transfers permitted to be effected directly by commercial banks in Morocco.
Peru11/24/89LiberalizationLegislation permitting Central Reserve Bank to guarantee availability of foreign exchange for purchases of nonfinancial services and for amortization and interest payments on loans associated with exploration and development of hydrocarbon projects passed.
Sri Lanka5/18/89LiberalizationAuthorized dealers allowed to remit abroad, without prior approval of Central Bank, remittances that were made to firms and individuals resident in Sri Lanka at request of remitter, provided that (1) remittance returned within a period of six months from date of receipt of remittance; (2) funds realized and credited to account had not been utilized for any purpose; (3) inward remittance so returned had not been effected in respect of any payments that were legitimately due to any resident in Sri Lanka for services rendered or goods supplied to a nonresident or otherwise; and (4) no foreign exchange facilities had earlier been granted on the basis of remittance.
Thailand5/22/90LiberalizationMaximum limit on foreign exchange commercial banks allowed to provide without verification for remittance by foreigners working in Thailand increased from equivalent of $5,000 to $50,000 a year.
Yugoslavia12/20/89LiberalizationResidents allowed to purchase foreign exchange from official banking system with dinars without restriction.
Zambia1/12/89LiberalizationRemittances by expatriate employees working on contract restricted to $4,260 a year (retroactive to November 8, 1988) to be denominated in U.S. dollars; previous limit denominated in kwacha (new limit in U.S. dollars was same as that expressed in kwacha at exchange rates prevailing before this date).
Zimbabwe4/18/89LiberalizationRegulations applying to use of blocked deposits liberalized, whereby transfers of such funds to approved new investors at freely negotiated price are permitted.
10/1/90LiberalizationRegulations liberalizing remittances of dividends and profits earned on foreign direct investments in new and existing export-oriented projects other than mining projects introduced.
Imports and Exports of Foreign and Domestic Currency Notes and Holdings of Foreign Currency Domestically
Industrial countries
Ireland4/1/90LiberalizationLimit on remittances representing personal loans or gifts to residents of non-EC countries raised to £Ir 20,000.
Developing countries—fuel exporters
Algeria8/7/90TighteningNonresident Algerian nationals required to convert at least DA 3,500 a year upon entering Algeria.
Developing countries—other
Burundi5/1/90LiberalizationLimit on domestic currency that a traveler may take out increased from FBu 2,000 to FBu 5,000.
China10/30/89TighteningRegulations issued regarding convertibility of foreign exchange certificates (FECs); foreign organizations in China no longer able to exchange FECs for foreign currency; non-Chinese nationals who are residents in China not permitted to exchange FECs for foreign currency except when leaving China permanently, and reconversion to be restricted to 50 percent of their documented purchases of FECs; tourists leaving China to be allowed to reconvert unused FECs into foreign currency only up to 50 percent of their original purchases.
Colombia11/21/90LiberalizationBank of the Republic stopped redeeming within a period of 80 days all exchange certificates in respect of receipts from services to be issued from November 21, 1990 to March 31, 1991.
Cyprus7/28/89LiberalizationExpatriate Cypriots and Cypriots working temporarily abroad, after resettling permanently in Cyprus, exempted from obligation to surrender foreign currency earned abroad.
Dominican Republic6/15/90IntroductionAll arriving travelers required to convert the equivalent of $100 into domestic currency.
7/13/90EliminationRequirement that all travelers arriving in the Dominican Republic convert the equivalent of $100 into domestic currency suspended.
11/5/90LiberalizationRemittances of foreign exchange abroad permitted to be made only through commercial banks in Dominican Republic.
Egypt7/11/89LiberalizationPublic sector hotels allowed to retain 25 percent of their foreign exchange earnings instead of 10 percent to meet their debt-service obligations; private sector hotels (other than hotels operating under Law No. 230, which are allowed to retain 100 percent) also allowed to retain additional 15 percent of their foreign exchange earnings with approval.
El Salvador12/5/90EliminationRestrictions on sale of foreign exchange for purposes of overseas travel, educational expenses, and official missions eliminated.
Israel6/15/90LiberalizationAmount of foreign exchange an Israeli resident is permitted to hold increased from the equivalent of $2,000 to $3,000.
6/15/90LiberalizationAmounts of domestic bank notes an Israeli resident and a nonresident traveler allowed to take out increased from the equivalent of $50 to $200 and from $100 to $200, respectively.
Mozambique11/19/90LiberalizationParticipants in the secondary exchange market allowed to maintain foreign currency accounts at Banco Popular de Desenvolvimento.
10/31/90LiberalizationIndividuals permitted to purchase up to $500 a day in the MSC on a “no-questions-asked basis.”
Pakistan7/1/90LiberalizationTravel agents and tour operators allowed to retain 5 percent of their foreign exchange earnings for marketing and related export promotion expenses.
Peru4/18/90TighteningPayments of insurance premiums and repayments of external credits with foreign exchange certificates no longer permitted.
Romania5/16/90LiberalizationProportion of foreign exchange receipts required to be repatriated by Romanians working in international organizations and joint ventures and of foreign exchange incomes received by Romanians reduced.
Rwanda12/1/90EliminationRequirement to declare foreign exchange on entering Rwanda abolished.
Sierra Leone12/13/89LiberalizationLimit on importation of domestic bank notes was increased from Le 250 to Le 2,500.
South Africa6/1/90LiberalizationLimit on transfers an emigrant family is allowed to make through financial rand increased from R 100,000 to R 200,000.
Sudan7/2/89TighteningPossession of foreign currency prohibited (previously, the equivalent of $1,000 a person permitted), and a deadline of July 31,1989 was set for surrendering foreign bank notes; deadline first extended to August 31, 1989, before becoming final on September 30, 1989; during grace period, surrendered bank notes (that is, without documentary evidence) could be used only to open exceptional foreign exchange accounts from which $5,000 a year a family could be used for invisible payments (for example, tourism, medical treatment, education); however, payments for imports from such accounts to be prohibited. Transfers of foreign exchange between bank accounts prohibited; since September 30, 1989, foreign exchange has been required to be surrendered with documentary evidence of transfer; the validation of currency declaration form (until compulsory surrender must be made) extended to two months from three weeks.
9/1/89TighteningWithdrawal of bank notes from foreign currency accounts was prohibited.
12/10/89TighteningA new law was enacted regulating transfers of Sudanese nationals working abroad. The transfers were moved from the official exchange rate to the commercial rate.
Suriname1/1/90EliminationNonresident travelers no longer required to exchange convertible currency in an amount equivalent to Sf 500 when entering Suriname at Zanderij International Airport, Nickerie, or Albina.
Thailand5/22/90LiberalizationMaximum limit on foreign exchange commercial banks are allowed to provide without verification increased as follows: 1) remittances in foreign exchange, which commercial banks were not previously authorized to provide, upon application up to equivalent of $50,000 a transaction; (2) remittance by Thai nationals to relatives who are residing abroad permanently, up to equivalent of $100,000 a person a year.
Yugoslavia10/11/90TighteningPurchase of foreign bank notes limited to the equivalent of DM 1,000 a person a purchase; export of foreign bank notes limited to the equivalent of DM 1,000 a person a trip.
11/21/90TighteningPurchase of foreign bank notes limited to the equivalent of DM 1,000 a person a month.
12/21/90TighteningPurchases of foreign exchange with dinars by resident nationals to make certain payments limited.
Zambia11/15/89LiberalizationLimit on amount of Zambian currency a traveler leaving and/or arriving in the country can carry is raised from K 10 to K 100.
Capital Controls
Commercial Banks’ International Transactions
Industrial countries
Finland3/1/90LiberalizationFinance companies permitted to apply for the right to intermediate and raise foreign loans to the extent allowed by limits on their foreign currency position.
7/1/90LiberalizationScope of financial sector enterprises to engage in foreign operations expanded.
France3/9/89LiberalizationAll exchange restrictions applicable to capital transactions by banks were eliminated under Decree 89–154.
Iceland1/1/89TighteningRatio (in terms of f.o.b. value) of investment goods allowed to be financed abroad by Icelandic businesses reduced to 50–60 percent.
12/29/89LiberalizationTaxes on foreign borrowing eliminated.
11/1/89LiberalizationRatio (in terms of f.o.b. value) of investment goods allowed to be financed abroad by Icelandic businesses increased to 70–80 percent; importers also permitted to obtain suppliers’ credits for individual shipments of goods with a maturity of up to one year as long as transaction not guaranteed and funds not released by a domestic financial institution; otherwise, the maximum maturity period restricted to six months.
9/1/90LiberalizationForeign Exchange controls on long-term capital transactions liberalized, permitting residents to freely obtain credits up to a specified limit.
Ireland4/1/90LiberalizationIrish financial institutions permitted to accept deposits in Irish pounds, without limit at fixed terms of at least three months, from both bank and nonbank nonresidents without prior reference to Central Bank.
Italy2/17/89TighteningMarginal reserve ratio on authorized banks’ net foreign currency deposit liabilities (which had been equal to zero since September 13, 1987) raised to 25 percent.
5/2/90EliminationRemaining restrictions on authorized banks’ foreign exchange management abolished whereby authorized banks no longer required to balance foreign exchange position and net external position, and “spot against forward” operations in foreign exchange no longer subject to ceilings.
Japan4/1/89LiberalizationCeiling on monthly transactions between Japanese offshore market and the domestic markets raised from 5 percent to 10 percent of total average investment balance of participants in previous month.
5/1/89LiberalizationVoluntary restraints on medium- and long-term yen-denominated lending by foreign exchange banks located outside Japan abolished.
New Zealand1/1/90LiberalizationAny financial institution permitted to deal in foreign exchange without authorization.
Portugal3/20/89LiberalizationForeign exchange swap operations ceased to enjoy special treatment under the regulations on banking credit ceiling.
7/1/90TighteningEnterprises drawing financial credits from abroad required to deposit equivalent of 40 percent of credits in an unremunerated account with Bank of Portugal.
Spain1/31/89TighteningThirty percent nonremunerated deposit requirement imposed on all new net foreign borrowings by Spanish residents.
5/14/90LiberalizationBanks allowed to extend loans in foreign currencies to residents for financing real estate purchases abroad.
6/19/90EliminationRestrictions on guaranteeing of loans extended by or received by residents eliminated. However, prior verification required before payments against such guarantees may begin.
Sweden7/1/90LiberalizationExchange Control Act and Exchange Control Ordinance abolished, and Emergency Contingency Act passed by Parliament, under which it included provision that residents generally not be allowed to deposit capital in foreign bank accounts or to effect or receive payments through such an account.
United States12/31/89LiberalizationU.S. banks allowed to accept foreign currency deposits.
Developing countries—fuel exporters
Indonesia1/29/90LiberalizationJoint-venture banks and foreign banks permitted to open branch offices in Batan Island, which is being developed as an export-processing zone.
Developing countries—other
Bangladesh9/30/89LiberalizationAuthorized dealers allowed to grant, without reference to Bangladesh Bank, loans in domestic currency to foreign-owned manufacturing companies located in Bangladesh to the extent of 140 percent of their paid-in capital, reserves, undistributed profits, and unremitted dividends as disclosed by their last audited balance sheets.
Brazil4/20/89LiberalizationTransfers abroad of the proceeds from sales of property and inheritance permitted up to limit of $300,000 or its equivalent in other currencies, provided that transfers are made through an authorized dealer with supporting documentation.
Colombia6/6/90LiberalizationCeiling applicable to foreign currency deposits that domestic commercial banks and financial corporations may hold increased from 8 percent to 15 percent of their total foreign exchange liabilities.
Dominican Republic5/3/90LiberalizationCommercial banks authorized to purchase foreign exchange from the public and surrender it to Central Bank.
Egypt4/23/89LiberalizationCommercial banks allowed to use portion of resources of new bank market for settlement of private sector debt obligations in foreign currencies regardless of date on which debt became due; in addition, commercial banks allowed to sell their foreign exchange earnings (accumulated net profits in foreign exchange) to their indebted private sector customers for purpose of settlement of debts denominated in foreign exchange at prevailing new bank market rate.
El Salvador7/1/90LiberalizationAuthorization for payments of invisibles transferred to commercial banks and exchange houses.
India7/20/89LiberalizationAuthorized dealers permitted to furnish counter-guarantees to their foreign branches/correspondents to cover guarantees to be issued by the latter in favor of local beneficiaries on behalf of Indian exporters, in accordance with local regulations where these stipulate that such guarantees can be obtained only from resident banks.
Israel1/5/89LiberalizationMinimum term on loans obtained by residents reduced from 30 months to 24 months (it was further reduced to 18 months on April 1, 1989); preferential export credit scheme liberalized, whereby exporters are no longer restricted from obtaining financing arranged by Israeli banks, but are permitted to obtain financing from any sources and guarantees of such financing for export production period by Israeli banks; interest rate under the scheme, generally corresponding to LIBOR plus 2 percent, replaced by a range consisting of LIBOR plus 1 percent as the “base,” plus a risk premium (differentiated for each borrower) of 0–2 percent.
Jordan5/31/89TighteningEnforcement of requirement that commercial banks deposit 35 percent of their foreign currency deposits with Central Bank of Jordan; these deposits must be in the form of time deposits with terms of not less than one month or of customers’ deposits in foreign banks abroad and must be denominated in deutsche mark, French francs, pounds sterling, Swiss francs, or U.S. dollars; Central Bank of Jordan pays interest on deposit balances at rate announced by the Reuter monitor for similar deposits, but this rate is 0.5 percentage point below the Reuter monitor rate for deposit balances that are less than the required 35 percent; fines imposed at a rate of 10 percent a year on any shortfalls on deposit balance.
Panama1/1/89LiberalizationRestrictions on withdrawals from demand deposits lifted.
4/15/90EliminationRestrictions on withdrawals from savings deposits lifted.
7/5/90EliminationRestrictions on withdrawals from time deposits lifted.
Peru4/17/90TighteningMaximum transfer abroad for banks that had not completed required transfers of surrendered export proceeds reduced from $100,000 to $50,000.
8/8/90EliminationRestrictions on debt-service payments on nonguaranteed private sector debt eliminated.
Philippines9/13/90IntroductionGuidelines governing the purchase and sale of foreign exchange by commercial banks issued.
Romania1/15/90LiberalizationProvisions for foreign exchange accounts liberalized; requirement to keep all foreign exchange in bank accounts and restrictions on use of foreign exchange from these accounts eliminated.
Thailand5/22/90LiberalizationMaximum limits on transfers that commercial banks are authorized to approve without prior approval increased as follows: (1) remittances of funds by emigrants or inheritances of emigrants, up to the equivalent of $1 million a person a year; and (2) repayment of loans that have not been registered with Bank of Thailand, proceeds from sales of securities or funds from liquidation, up to the equivalent of $500,000 a transaction.
Turkey9/13/89LiberalizationForeign exchange risk ratios that determine the maximum and minimum ratios of foreign-currency-denominated assets and liabilities commercial banks may hold widened to 88–115 percent from 90–110 percent.
3/3/90EliminationMinimum utilization ratio requirement, under which banks were required to extend 50 percent of foreign exchange deposits as foreign credit, abolished.
8/17/90TighteningLimit on amount of foreign exchange for which the exchange rates are allowed to be negotiated freely between authorized institutions and their customers reduced from $10,000 to $3,000.
10/20/90LiberalizationDomestic banks and branches of foreign banks allowed to operate in free trade zone to conduct offshore banking activities with approval.
Nonresidents’ Accounts and Residents’ Foreign Exchange Accounts
Industrial countries
Belgium and Luxembourg7/15/89LiberalizationAdvances on Convertible Accounts to be allowed if extended for at most six months and used for immediate payment in favor of residents for transactions specified on Lists A and B.
France3/9/89LiberalizationEnterprises engaged in international trade no longer subject to exchange restrictions. All residents, including individuals and companies having no international activities, permitted to open ECU-denominated accounts in France.
1/1/90EliminationExchange controls lifted allowing residents to hold accounts in foreign currency.
1/1/90LiberalizationExchange restrictions that remained in force at end of 1989, which had prohibited individuals and enterprises not engaged in international activities from holding either monetary assets abroad or accounts in France in foreign currencies other than ECUs, abolished; residents of all OECD countries permitted to issue foreign securities in France (previously only permitted to residents of EC countries); requirement that recognized EC residents declare their direct foreign investments in France eliminated, and foreign direct investments by liquidation must be reported to the Ministry within 20 days of their occurrence; foreign direct investments by residents are not restricted.
Greece3/9/89LiberalizationMaturity of loans in foreign exchange contracted by exporting firms permitted to be less than six months.
Japan7/30/90LiberalizationSystem of foreign deposit accounts liberalized as follows: (1) in addition to individuals, corporations allowed to open accounts abroad; (2) ceiling on accounts maintained abroad without restriction but requiring reporting to Bank of Japan raised from ¥ 5 million to ¥ 30 million; (3) ceiling on accounts permitted to be maintained abroad with automatic approval of Bank of Japan raised from ¥ 30 million to ¥ 100 million; and (4) trading of foreign securities with deposit balances on accounts held abroad liberalized.
Portugal3/9/90LiberalizationSubject to authorization of Bank of Portugal, resident corporations which conduct a significant proportion of business with foreigners allowed to open non-interest-bearing accounts in foreign currency, to be used mainly to channel payments to and receipts from international transactions in goods, services, and capital. Account balance at the end of each month required not to exceed a certain percentage of average amounts of payments or receipts in foreign currency recorded the previous year. Resident individuals allowed to open foreign currency accounts at home to support portfolio operations in foreign securities listed in stock exchanges. Maximum balance on these accounts at the end of each month set at Esc 4 million.
Spain9/26/89LiberalizationSpanish residents permitted to maintain accounts in ECUs at authorized banks.
4/4/90EliminationProhibition against payment of interest on nonresident convertible peseta accounts with balances exceeding Ptas 10 million removed.
6/22/90LiberalizationOperations of ECU accounts held by residents further liberalized.
Sweden7/1/89LiberalizationAll remaining currency regulations virtually abolished; in addition, nonresidents allowed to invest in Swedish bonds and money market instruments denominated in Swedish kronor and to make deposits in Swedish kronor in interest-bearing accounts in Swedish banks; remaining exchange controls would apply to deposits made by Swedish companies and individuals in foreign banks and to payments of life insurance premiums to insurance companies outside Sweden.
Developing countries—fuel exporters
Algeria9/8/90LiberalizationEconomic entities eligible to open foreign currency accounts in Algerian banks; retained export proceeds not required to be deposited in a foreign currency account; retention ratios increased as follows: (1) 20 percent for tourism operators and wine exporters; (2) 50 percent for agricultural and fisheries product exporters; and (3) 100 percent for exporters of all other goods, except hydrocarbon and mineral products, ratio for which remained at zero, and for transport and financial services, for which ratio remained at 10 percent.
Developing countries—other
Bangladesh8/22/90LiberalizationInterest rates on nonresident foreign currency deposits raised 1 percentage point above the interest rates paid on Eurocurrency deposits with similar maturities.
Brazil11/16/89LiberalizationExport and import companies permitted to maintain foreign currency deposits with establishments authorized to operate in foreign exchange, but funds on these accounts must be transferred to Central Bank.
Burundi7/1/89LiberalizationPeriod after which all nonresidents’ earned income, rents, profits, and dividends may be transferred reduced to four years.
Cyprus7/19/89LiberalizationAnnual foreign exchange allowance granted to residents emigrating for permanent residence abroad was increased from £C 5,000 to £C 10,000.
Egypt4/20/89LiberalizationEmigrants of Egyptian nationality allowed to export personal effects and furniture up to LE 1,200 a person and LE 3,000 a family; a woman of Egyptian nationality married to a foreigner and holding a “Departure Form A” authorized to export up to LE 6,000 when leaving the country permanently.
El Salvador7/31/89LiberalizationDuty-free shops allowed to open foreign currency deposit accounts.
Guinea-Bissau3/1/90LiberalizationCommercial bank authorized to accept foreign exchange deposits from nonresidents; these deposits, which may be used without restriction and be freely transferable abroad, to be remunerated in foreign exchange, at a rate of 4 percent a year in the case of demand deposits and at freely negotiated rates in the case of time deposits.
Hungary9/18/89LiberalizationUp to 100 percent of income or assets in convertible currencies relating to the following allowed to be maintained in convertible currency accounts: (1) foreign exchange earned from creative, inventive, or artistic activities; (2) honoraria; (3) prizes, awards, and winnings on foreign exchange lotteries; (4) gifts from abroad; and (5) specified fees. Up to 10 percent of export proceeds of small-scale traders and private enterprises may also be maintained on these accounts.
Israel6/15/90LiberalizationLimit on assets an emigrant is permitted to transfer abroad annually raised from the equivalent of $2,000 to $4,000.
8/15/90LiberalizationVarious resident deposit accounts consolidated into two main types of foreign currency accounts (current and one-year deposit and transitory accounts).
Jamaica1/1/90LiberalizationExporters of nontraditional goods and services allowed to deposit 7.5 percent of their earnings in convertible currencies in a retained account in a commercial bank, and permitted to use balances on these accounts without restriction.
7/1/90LiberalizationResidents and nonresidents permitted to maintain “A” accounts.
10/1/90LiberalizationResidents and nonresidents permitted to maintain “B” accounts.
11/1/90LiberalizationAny company in the same group as hotel or tourism activity that earns foreign exchange made eligible to maintain a Jamaican National Retained Account.
Jordan8/15/89LiberalizationJordanian exporters permitted to maintain with any commercial banks or financial institutions foreign exchange accounts, to be credited with up to 30 percent of export proceeds.
8/27/89LiberalizationBalances on time deposits of Jordanian residents in foreign currencies with terms of less than six months allowed to be withdrawn before maturity; if these deposits are credited with foreign currency notes, they may be debited only with currency permits, whereas if they are credited with transfers through banking system or with checks in foreign currency, withdrawals are permitted without any restriction.
Madagascar12/29/89LiberalizationEnterprises operating in Free Trade Zone permitted to maintain foreign currency accounts with local banks.
Mauritius7/1/90LiberalizationLimit on remittance by emigrant increased from Mau Rs 200,00 to Mau Rs 500,000 a family.
Morocco4/25/89LiberalizationMinimum initial deposit required for nonresident Moroccan to open convertible dirham account reduced from DH 500,000 to DH 50,000.
4/6/90EliminationMinimum amount for opening of convertible dirham accounts by nonresident Moroccans abolished.
Mozambique11/27/89LiberalizationBanco Standard Totta de Mozambique began operating foreign currency accounts for embassies and consulates, international organizations, and resident foreign citizens.
Pakistan1/15/89TighteningTransfers of Pakistan securities between two nonresidents would require permission from Government if original investment in Pakistan required government approval.
7/29/90LiberalizationAuthorized dealers permitted to accept foreign currency deposits of 1-year, 2-year, and 3-year maturities at interest rates not exceeding 0.25 percent a year, 0.75 percent a year, and 1 percent a year, respectively over 12-month LIBOR quoted by Barclays Bank Ltd., London.
12/1/90LiberalizationForeign currency accounts held in Pakistan by Pakistani nationals under Foreign Currency Accounts Scheme permitted to be maintained permanently after their return to Pakistan.
Peru8/11/89LiberalizationRepatriated foreign exchange earnings permitted to be sold at free market exchange rate or deposited in foreign exchange accounts.
Poland10/15/90Tightening“S” accounts abolished with outstanding balances converted into zlotys.
Romania9/7/90LiberalizationAll exporters allowed to maintain foreign exchange retention accounts in which 50 percent of export proceeds to be deposited.
Sierra Leone12/13/89LiberalizationForeign currency accounts allowed to be maintained by residents in Sierra Leone subject to certain conditions.
3/25/90LiberalizationResidents permitted to hold foreign currency accounts with commercial banks in any convertible currency, and commercial banks permitted to process payments for imports of goods and services from these accounts without approval of Bank of Sierra Leone.
Thailand5/22/90LiberalizationMaximum amount allowed to be transferred to each nonresident baht account increased to B 5 million a day.
Turkey8/17/90TighteningTurkish officials and private businessmen working abroad temporarily and Turkish workers living abroad who have returned to Turkey permanently no longer permitted to open new deposit, and deposit accounts opened before this date required to be closed on maturity.
Yugoslavia12/21/90TighteningTransfers abroad from foreign currency accounts held by resident nationals not allowed up to December 31, 1990.
Zambia10/20/90LiberalizationBank of Zambia permitted nonresident Zambians and resident Zambians working for international organizations to open nonresident accounts in U.S. dollars and pounds sterling with commercial banks. Opening of such accounts requires prior approval from Bank of Zambia.
Portfolio Investments
Industrial countries
Austria2/1/89LiberalizationVirtually all restrictions on long-term capital transfers abolished; only remaining restrictions concerned (1) issuance of securities on foreign capital markets and of foreign securities on domestic capital markets; and (2) acquisition of real estate by nonresidents.
Finland9/1/89LiberalizationRegulations on outward and inward capital transfers liberalized, with immediate effect, except for outward capital transfers by private individuals for which regulation would enter into effect no later than July 1, 1990; with respect to inward capital transfers, nonfinancial institutions, except for housing and real estate companies, permitted to obtain foreign loans of more than one year’s maturity (previously, only loans of more than five years’ maturity were permitted); suppliers’ credits and prepayments in respect of imports were fully exempted from authorization by Suomen Pankki; and most direct investments in Finland would no longer require authorization by Suomen Pankki.
2/1/90Liberalization(1) Markka-denominated bonds with maturities exceeding one year permitted; (2) nonresidents authorized to issue markka-denominated bonds in Finland; (3) share issues by Finnish companies abroad not subject to prior authorization; (4) quotation by the Helsinki Stock Exchange or the OTC market as a condition for the issue of foreign securities in Finland not required; and (5) nonresidents purchasing Finnish securities not required to effect their purchases through the Helsinki Stock Exchange or the OTC market.
France1/1/90LiberalizationFirms based in OECD countries permitted to issue securities on French capital market (previously only EC countries permitted to do this).
1/15/90LiberalizationAdministrative procedures for acquisition of existing French enterprises simplified and placed on a lapse-of-time basis so as to expedite authorization procedures when these are still required. Authorization procedures continue to apply to companies from outside the European Community for investments exceeding F10 million. Investment applications would be considered to be approved if the Ministry of Economy, Finance, and the Budget does not object within one month.
Greece1/14/90LiberalizationLimit on purchases of securities issued by European Community and European Investment Bank increased from ECU 50 million to ECU 75 million a year.
Iceland12/15/90LiberalizationResidents allowed to purchase real estate and foreign securities and to undertake foreign investments up to specified limits.
Ireland1/1/89Liberalization(1) All restrictions on purchases of foreign securities with maturities exceeding two years eliminated; and (2) exchange controls applicable to sales of existing holdings of securities issued by EC, European Investment Bank, European Coal and Steel Community, and European Atomic Energy Community abolished.
4/1/90LiberalizationPeriod for which sale proceeds from medium- and long-term foreign securities may be held in foreign currency extended to six months from three months.
Italy1/19/90LiberalizationDecree issued allowing residents to purchase bonds and money market instruments issued or payable abroad with remaining maturity terms of less than 180 days. Upon maturity, reimbursed funds can be deposited in Foreign Exchange Accounts without obligation to convert into lire.
Japan1/4/89LiberalizationNew portfolio investment guidelines for foreign exchange banks were announced; guidelines included: (1) the abolishment of risk assets ratio requirement and introduction of Bank for International Settlements portfolio investment guidelines; (2) introduction of ceilings on lending to specified countries of 40 percent of equity capital; and (3) requirement that liquidity ratio in foreign currency deposits be reported to competent authorities.
1/31/89LiberalizationInvestments in form of foreign currency deposits by investment trusts permitted.
2/1/89LiberalizationCeiling on investments in foreign bonds by loan trust and money trust raised from 3 percent to 5 percent of total assets.
6/16/89LiberalizationIssuance of yen-denominated bonds in foreign markets by nonresidents fully liberalized with abolishment of restrictions on maturities and issuance-eligibility standards.
6/24/89LiberalizationLimit on sale of bonds issued in foreign markets to domestic investors of up to 50 percent of total issuance abolished.
Norway5/9/89LiberalizationNonresidents allowed to purchase bonds denominated in Norwegian kroner quoted and registered in Norway and carrying a maturity of at least one year, provided that such purchases are made through authorized Norwegian brokers; new rules also apply to shares in Norwegian bond funds.
6/14/89LiberalizationResidents allowed to incur or provide commercial and financial guarantee obligations abroad without permission from Bank of Norway, provided that such guarantees cover licensed transactions or transactions for which no license is required.
6/30/89LiberalizationResidents allowed to acquire quoted and nonquoted shares of foreign collective investment funds without permission from Bank of Norway, provided that such transactions conducted through authorized Norwegian brokers.
12/7/89LiberalizationNonresidents allowed to issue bonds denominated in Norwegian kroner in Norway subject to license; bonds issued by nonresidents have to be conducted through authorized Norwegian brokers; residents allowed to purchase and sell bonds issued by licensed nonresidents.
12/8/89Liberalization(1) Residents allowed to acquire foreign nonquoted shares in low-taxation countries subject to license; nonresidents allowed to acquire fixed property in Norway without license.
(2) All companies except commercial banks, savings banks, municipal companies, and companies guaranteed by the local or central governments allowed to raise foreign currency loans to finance their own operations or operations of affiliated companies; loans from lenders that do not have special permission from Bank of Norway still subject to license.
(3) Individuals allowed to obtain foreign currency loans abroad for purpose of financing business activities subject to license.
(4) Contracts of loans in Norwegian kroner between nonresidents and residents made possible subject to license; applications for such loans are treated in the same way as applications for foreign currency loans.
(5) Norwegian insurance companies allowed to engage in endowment insurance contracts with nonresidents without license.
(6) Legal entities allowed to engage in financial leasing contracts in foreign currencies with Norwegian financial institutions without permission from Bank of Norway; leasing contracts with foreign financial institutions are subject to license, but applications treated liberally.
Portugal4/29/89LiberalizationLimits applicable to investments in EC and OECD countries that are allowed freely increased to Esc 50 million.
9/20/89LiberalizationLimits on investment in foreign securities by institutional and individual investors increased to Esc 4 million.
3/28/90LiberalizationLimits up to which residents can invest in foreign securities listed in stock exchanges in OECD member countries raised as follows: legal entities, 20 percent of their total portfolio (or technical reserves in the case of insurance companies); and individuals, Esc 10 million.
7/1/90LiberalizationPortfolio investments by residents in foreign currency securities officially list in recognized stock exchanges abroad fully liberalized.
Spain4/4/90EliminationRestrictions on purchases of marketable foreign monetary instruments by Spanish residents removed.
4/4/90LiberalizationPurchases (outright or repurchase agreements) of public bonds by nonresidents fully liberalized.
6/22/90EliminationRestrictions on purchases by residents of securities denominated in pesetas issued by nonresidents on Spanish stock exchanges removed.
6/22/90LiberalizationPurchases by residents of shares issued by foreigners on Spanish stock market classified as foreign investments but not subject to declaration.
7/8/90LiberalizationNonresidents allowed to purchase freely foreign securities in Spanish stock exchanges. Purchases must, however, be reported to authorities by authorized banks. Nonresidents allowed to sell these securities without restriction, provided they were purchased initially with proceeds from sales of foreign currencies.
12/27/90EliminationTo comply with EC provisions, most remaining regulations limiting portfolio investments by residents abroad and by nonresidents in Spain abolished. Foreigners exempted from income tax on dividends and capital gains, provided they do not have permanent residency in Spain.
Developing countries—fuel exporters
Gabon7/6/89TighteningForeign companies investing in Gabon required to offer shares for purchase by Gabonese nationals equivalent to at least 10 percent of the companies’ capital.
Developing countries—other
Chile6/25/90LiberalizationIndividuals and legal entities, domiciled and resident abroad, which meet specific conditions, granted access to official exchange market to remit abroad (1) proceeds from sales of stocks of registered corporations domiciled in Chile that were purchased with funds from abroad; and (2) dividends and profits accruing from such stocks.
Colombia12/2/89LiberalizationNew law governing direct foreign investments in financial sector promulgated; law permits foreign participation of up to 49 percent in entities in financial sector, including commercial banks, financial corporations, insurance companies, and trade-financing companies; law would also permit foreign majority participation in institutions that receive support from Guaranteed Fund.
12/22/89LiberalizationNew law permitting establishment of foreign investment funds promulgated; with approval of National Planning Board, shares of such funds may be placed in the stock exchange; invested funds can be repatriated five years after registration with the Exchange Office.
Israel6/2/89LiberalizationResidents permitted to invest abroad up to 10 percent of portfolio of financial assets (up to 50 percent in the case of funds specializing in foreign currency investments) with their own funds.
8/3/89LiberalizationForeign residents’ right to reconvert investment proceeds expanded to include investments in debentures issued by Israeli companies whose stocks are traded in Tel Aviv Stock Exchange, excluding those issued by banking institutions or guaranteed by them.
9/29/90LiberalizationLimit on minimum period of direct loan from abroad reduced from 12 months to 6 months.
Korea2/13/89LiberalizationRequirement concerning credit standing of residents investing abroad abolished; minimum equity investment ratio lowered to 20 percent; and minimum interest rate for long-term loans removed.
3/2/90LiberalizationLimits on foreign exchange holdings for investment in foreign securities by domestic securities firms authorized to handle international business increased from US$30 million to US$50 million, and by insurance and investment firms, from US$10 million to US$30 million.
Madagascar12/29/89LiberalizationEnterprises operating in Industrial Free Trade Zone permitted to borrow abroad on their sole responsibility.
Malta7/16/90LiberalizationResidents over age 18 allowed to invest in overseas financial assets up to a maximum amount of Lm 1,000 a person a year. A 10 percent tax imposed on investments under the Expenditure Levy Act 1990.
Mauritius7/14/89LiberalizationTransfer tax on capital transfers reduced from 45 percent to 15 percent.
Panama10/1/89LiberalizationNew incentives for foreign investment-processing zones announced.
Philippines6/9/89LiberalizationSales proceeds of central-bank-registered foreign investments in a domestic company whose stocks were not listed permitted to be traded in local stock exchanges; company shares that were subsequently listed/ traded in local stock exchanges at time of their sale permitted to be repatriated in full, net of taxes and fees, subject to prior approval by Central Bank.
Rwanda4/1/90LiberalizationResidents permitted to hold foreign currency with commercial banks in any convertible currency.
Turkey6/19/89LiberalizationAmendments to Corporation Tax Law and Income Tax Law, exempting “investment funds subject to limited tax liability,” adopted; foreign investment funds approved by Treasury allowed to set up securities portfolios, income from which would be tax free.
8/11/89LiberalizationForeign residents allowed to purchase or sell any type of Turkish securities registered on stock exchange through intermediary institutions operating on the market and to transfer income or proceeds from sales of these securities abroad through banks and authorized financial institutions, provided that such proceeds would not be transferred abroad; if securities had not been purchased with funds transferred from abroad, proceeds from sales of securities allowed to be utilized freely in Turkey.
2/25/90LiberalizationNonresidents allowed to purchase securities, including mutual funds, issued with the permission of the Capital Market Board or issued by the public institutions through intermediary institutions operating under the Capital Market Law and listed at the stock exchange.
2/25/90LiberalizationResidents in Turkey allowed to secure foreign credits abroad in cash or kind, provided banks or special financial institutions used as intermediaries.
2/25/90LiberalizationResidents allowed to invest abroad in cash up to $5 million or its equivalent in other currencies through banks and special finance institutions domiciled in Turkey; investments exceeding $5 million to be permitted with prior approval.
Zimbabwe1/20/89LiberalizationSubject to Reserve Bank approval, repatriation of funds invested in external government bonds at accelerated rates, depending on discounted sales prices of net equity, allowed.
4/18/89LiberalizationRegulations governing foreign investment were modified, whereby remittances of after-tax profits of up to 100 percent would be approved depending on the priority status of investment.
Direct Investments
Industrial countries
Finland6/1/89LiberalizationRegulations on direct investments in financial and insurance sector liberalized; only direct investments by private individuals and direct investments in countries with which Finland maintains payments agreements subject to the authorization of Suomen Pankki.
Greece7/1/89LiberalizationDirect investments by residents of Greece in EC countries fully liberalized.
Japan7/1/90LiberalizationPrivate persons permitted to undertake foreign investments and grant loans of over one year’s maturity to nonresidents without limit.
New Zealand8/24/89LiberalizationMinimum value of direct investments requiring consent from Overseas Investment Commission raised to $NZ 10 million except in certain specified sectors.
Spain12/27/90LiberalizationResidents of EC countries allowed to invest freely in all sectors of the economy, except in defense-related industries.
Sweden1/19/89LiberalizationRiksbank abolished all restrictions on acquisition of foreign equity; shares must, however, be in safekeeping of authorized bank or broker; general exemption announced for sale to nonresidents of Swedish unlisted shares; as from March 1, direct investments, both outward and inward, as well as disinvestments could be made through authorized banks without prior approval of Riksbank.
United Kingdom2/21/90EliminationBan on foreign direct investments in South Africa lifted.
Developing countries—fuel exporters
Algeria4/14/90LiberalizationRestrictions on foreign investments liberalized, permitting investments in all areas not expressly reserved for the state. Repatriation of capital and profits allowed, subject to the international agreements ratified by Algeria.
Mexico5/1/89LiberalizationRestrictions on foreign capital participation in new direct foreign investments were liberalized substantially.
Venezuela3/15/89LiberalizationA new framework for debt-equity conversions established.
9/6/89LiberalizationRegulations governing an auction-based system for conversion of public external debt into equity issued.
1/5/90LiberalizationForeign direct investments liberalized as follows: (1) elimination of need for prior authorization for investment and of restrictions on foreign investments in certain sectors; (2) foreign firms permitted to open subsidiaries in Venezuela to contract technology without restriction, to invest in Venezuelan securities and stocks, and to obtain financing through shares or debt notes in Venezuelan capital market.
Developing countries—other
Belize3/1/90IntroductionScope of foreign direct investments widened, and incentives for foreign investment improved.
Bolivia9/17/90LiberalizationNew investment law covering all sectors except mining and hydrocarbons approved. Law put domestic and foreign investors on an equal footing.
Brazil6/26/90LiberalizationRepatriation of capital liberalized.
Burundi5/1/90LiberalizationShare of return on foreign capital and share allocated to foreign directors permitted to be transferred freely increased to 60 percent of distributed profits in the case of agricultural and industrial enterprises, and to 80 percent in the case of firms that export at least 50 percent of production.
Cameroon8/10/90Introduction(1) Cameroon’s participation in the share capital of each banking institution required to be at least 33 percent; (2) banking institutions with foreign majority participation required to submit to monetary authorities information on all of their current transactions abroad and obtain prior approval for any changes in the structure of their equity holdings; and (3) foreign managers required to be approved by monetary authorities and reside in Cameroon.
China2/14/89TighteningAll foreign commercial borrowings subject to approval; all commercial borrowings to be channeled through one of ten domestic entities; short-term debt of each entity not to exceed 20 percent of entity’s total debt, and short-term borrowing to be used only for working capital purposes.
3/6/89LiberalizationState Administration of Exchange Control (SAEC) announced procedures governing Chinese direct investment abroad; such investments would require government and SAEC approval, a deposit of 5 percent of investment to secure repatriation of dividends and other income from investment, and repatriation of earnings within six months.
4/4/90LiberalizationLaw on Chinese-foreign equity joint ventures changed as follows: (1) state would not nationalize joint ventures; (2) approval procedures for new foreign investment enterprises were simplified; and (3) management rights of foreigners were extended.
5/19/90IntroductionRegulations on sale and transfer of land use rights in cities and towns aimed at encouraging foreign investors to plan long-term investment adopted.
Ethiopia7/25/89LiberalizationJoint-venture decree promulgated: it specifies areas in which joint ventures are permitted; guarantees repatriation of proceeds from liquidation of investment (and dividends); and provides for exemptions from customs tariffs on inputs and equipment imported by joint ventures for production purposes and from income taxes for period of three to five years.
5/19/90LiberalizationSpecial Decree on Investment No. 17/1990 promulgated, removing restrictions on the size, type, and sectors of activity, and guaranteeing right of foreign investors to remit profits/dividends and proceeds from sale of assets.
India5/1/90LiberalizationForeign investment policy liberalized, allowing automatic approval of foreign investment proposals of foreign companies with equity shares of up to 40 percent.
9/22/89LiberalizationNonresident Indians/persons of Indian origin (NRIs) and overseas corporate bodies permitted to invest in India, with full repatriation benefits, up to 100 percent of new issues of shares/convertible debentures issued by hotels in three-, four-, and five-star category (previously, only direct investments allowed in these cases up to 74 percent of new issues).
Korea7/1/89LiberalizationNonresidents were permitted to invest freely in six manufacturing sectors, regardless of their equity ratio; amount of new foreign investments permitted without reference to the capital review committee was increased from $3 million to $5 million.
1/1/90LiberalizationCeiling on value of foreign investments subject to automatic approval raised from $3 million to $100 million; share limit on foreign equity investment in advertising firms increased to 99 percent.
7/1/90LiberalizationForeign investment permitted in wholesale activities of toiletries and cosmetics.
Lesotho8/10/89TighteningNonresidents were prohibited from purchasing farms and residential properties with financial rand.
Malaysia3/21/89LiberalizationDomestic credit facilities for financing purchases of immovable property in Malaysia by nonresidents and non-resident-controlled companies were permitted for up to 50 percent of purchase consideration; such borrowing was required to be repaid within three years.
12/5/89TighteningLimit on new foreign capital equity participation in firms manufacturing impressed/imprinted products was reduced from 100 percent to 60 percent.
Mauritania1/23/89LiberalizationNew investment code, providing for various benefits and guaranteeing transfers of dividends profits, came into effect.
Morocco12/5/89LiberalizationDecree of 1973, which established general limit of 49 percent on allowable share of foreign participation in local enterprises, was abrogated; limits on share of foreign participation would, however, continue to apply in a few sectors in accordance with sectoral decrees.
Peru3/10/89LiberalizationForeign Exchange Bank Certificates (FEBCs) permitted to be used for domestic investment purposes with approval of National Commission on Foreign Investments and Technology.
3/18/89LiberalizationFEBCs permitted to be redeemed to make provisions for meeting debt-service obligations with Central Bank approval.
4/21/89LiberalizationLegislation approved for conversion of donated public debt for development projects; for qualified projects, fiscal authorities will make available amount in domestic currency to cover local expenses equal to face value of donated debt obligation.
7/4/89LiberalizationDisbursements of private sector debt, domestic foreign exchange credits, and payments of capital, interest, and commissions were permitted at free market exchange rate; lines of credit to the public sector permitted to be serviced at the controlled (MUC) exchange rate.
7/7/89LiberalizationConversion System for Donated Public Debt to finance economic and social development projects approved.
Poland1/1/89LiberalizationNew joint-venture law entered into effect, replacing the Law on Companies with Foreign Capital Participation that had been in effect since July 1,1986; under new law, joint ventures could have majority foreign participation and a foreign general manager; joint ventures eligible for income tax relief and foreign exchange retention on exports at rate of 85 percent; minimum capital requirement equivalent of $50,000, and joint partners permitted to transfer abroad their profits up to difference between exports and imports.
11/9/89LiberalizationAgreement to protect foreign investment signed between Poland and Federal Republic of Germany; with respect to German investment in Poland, transfers of profits and dividends allowed; sales or liquidation proceeds of German investments made before effective date of treaty can be repatriated.
1/1/90EliminationInvestment Law abolished income tax relief for joint ventures related to exports.
Romania3/14/90LiberalizationNew Foreign Investment Law liberalizing direct foreign investments adopted.
Somalia12/5/89LiberalizationNew banking law allowing residents as well as nonresidents to establish commercial banks introduced.
South Africa8/10/89TighteningNonresidents prohibited from purchasing farms and residential properties with financial rand.
Togo10/31/89LiberalizationNew investment code, emphasizing generation of employment of resident workers and streamlining tax-exemption privileges, adopted.
Turkey8/11/89TighteningApplications by residents of Turkey to make direct investments abroad of up to $25 million or its equivalent subject to approval; export of capital exceeding this amount subject to approval by Council of Ministers.
Viet Nam3/10/89LiberalizationState Committee for Cooperation and Investment established (and came into operation on July 1); it has responsibility for coordinating interministerial activities on foreign investment and facilitates administrative procedures applying to foreign investors.
January 1988International Capital Markets: Developments and Prospects, by Maxwell Watson, Donald Mathieson, Russell Kincaid, David Folkerts-Landau, Klaus Regling, and Caroline Atkinson.
February 1988Officially Supported Export Credits: Developments and Prospects, by K. Burke Dillon and Luis Duran-Downing, with Miranda Xafa.
April 1988World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
May 1988Multilateral Official Debt Rescheduling: Recent Experience, by Peter M. Keller, with Nissanke E. Weerasinghe.
May 1988Primary Commodities: Market Developments and Outlook, by the Commodities Division of the Research Department.
July 1988Staff Studies for the World Economic Outlook, by the Research Department of the International Monetary Fund.
October 1988World Economic Outlook: Revised Projections, by the Staff of the International Monetary Fund.
April 1989World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
April 1989International Capital Markets: Developments and Prospects, by a Staff Team from the Exchange and Trade Relations and Research Departments.
July 1989Primary Commodities: Market Developments and Outlook, by the Commodities Division of the Research Department.
August 1989Staff Studies for the World Economic Outlook, by the Research Department of the International Monetary Fund.
September 1989Developments in International Exchange and Trade Systems, by a Staff Team from the Exchange and Trade Relations Department.
October 1989World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
April 1990International Capital Markets: Developments and Prospects, by a Staff Team from the Exchange and Trade Relations and Research Departments.
May 1990Officially Supported Export Credits: Developments and Prospects, by G.G. Johnson, Matthew Fisher, and Elliott Harris.
May 1990World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
July 1990Primary Commodities: Market Developments and Outlook, by the Commodities Division of the Research Department.
September 1990Staff Studies for the World Economic Outlook, by the Research Department of the International Monetary Fund.
October 1990World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
November 1990Multilateral Official Debt Rescheduling: Recent Experience, by Michael G. Kuhn with Jorge P. Guzman.
May 1991International Capital Markets: Developments and Prospects, by a Staff Team from the Exchange and Trade Relations and Research Departments.
May 1991World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
October 1991World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
December 1991Private Market Financing for Developing Countries, by a Staff Team from the Exchange and Trade Relations Department.
May 1992World Economic Outlook: A Survey by the Staff of the International Monetary Fund.
May 1992Developments in International Exchange and Payments Systems, by a Staff Team from the Exchange and Trade Relations Department.
Note: For information on the titles and availability of World Economic and Financial Surveys published prior to 1988, please consult the most recent IMF Publications Catalog or contact IMF Publication Services.

    Other Resources Citing This Publication