OSHIKANGO - Export companies are lobbying government to facilitate payments in Angola’s kwanza currency at border posts instead of using the US dollar.
In a report to motivate their case, which New Era has seen, Namibian export companies operating at Oshikango are referring to the bilateral agreement between Brazil and Argentina, which “faced (similar) problems that the trade between Namibia and Angola is currently facing”.
The proposal dates back to 2009 and calls for an agreement to eliminate the need for a third currency, the US dollar, and instead to use the local Namibian dollar or Angolan kwanza. Such a system would increase liqui-dity and market efficiencies, the exporters argue.
Companies say an agreement on local currency payment between Namibia and Angola “would be in line with the economic cooperation agreement”, signed by the two countries in September 2005.
The proposal is for Namibian traders to deposit their sales in Angolan kwanza and eventually to exchange it through legal banking exchange channels to their preferred foreign or local Namibian currency.
Local banks could sell the kwanza to the Bank of Namibia which would repatriate it to Angola.
This would reduce demand for US dollar notes and help small traders who find it difficult to access US dollars due to the high costs of foreign currency.
The Bank of Namibia is already working on the integration of the two countries’ payment systems and currency exchange between the Namibian dollar and the kwanza.
This follows the Bank of Namibia’s “own research at the Oshikango border post” which found various challenges confronting businesspeople at the border town.
The central bank says it has already approached the National Bank of Angola with a proposal on how trade can be enhanced between the two countries.
There have been meetings between the two central banks on the subject of the kwanza in Namibia, with the last having taken place in March in Windhoek, when representatives of the National Bank of Angola visited the Bank of Namibia.
There are legal and logistical constraints on the Angolan side, however, but the central bank said the matter was taken up “at bilateral level between the two governments and may take some time to be resolved”.