( 4 minutes read)
· The African Energy Chamber (AEC) recently held a meeting with the Central Bank of Central African States (BEAC) to discuss the effects of foreign exchange regulations, which will come into effect on 1 January 2022
· BEAC in December 2018 adopted a set of regulations to regulate the outflow of foreign exchange
· The Chamber also said that transactions over FCFA 1 million (approximately US$ 1,700) per month per entity or person now attracted
significantly more bureaucratic delays for weeks together
The African Energy Chamber (AEC) recently held a meeting with the Central Bank of Central African States (BEAC) to discuss the effects of foreign exchange regulations, which will come into effect on 1 January 2022. BEAC in December 2018 adopted a set of regulations to regulate the outflow of foreign exchange.
Importantly, energy companies operating in the CEMAC region have raised the concern that the new foreign exchange regulations will stifle investments in the sector. It also expressed the concern that it would lead to loss of jobs, increase operational cost, lead to additional and unnecessary bureaucracy and eventually render the region’s energy industry uncompetitive compared to other regions globally.
The Chamber’s delegation, which was led by Mr. Leoncio Amada Nze, CEMAC Regional President for the African Energy Chamber, met BEAC’s Management, under the leadership of its Governor, Abbas Mahamat Tolli and expressed concerns about the new foreign exchange regulations. The Chamber also said that transactions over FCFA 1 million (approximately US$ 1,700) per month per entity or person now attracted significantly more bureaucratic delays for weeks together. Companies and individuals must now also receive an authorization from the BEAC before opening an account outside the region.
The Chamber further said that the regulation puts that proceeds from exports of FCFA 5 million and above be repatriated within 150 days from the exportation date. However, many businesses seek to avoid putting the proceeds of their exports under the very restrictive foreign exchange regime coming into place on January 1st, 2022.
