Illegal to Pay Wages in Dollars in Mozambique from Now On

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Illegal to Pay Wages in Dollars in Mozambique from Now On

3:14 CAT | 07 Dec 2015

In file Club of Mozambique

It is now illegal to pay wages in dollars, and there are limitations on credit card use abroad.

The use of dollars as a parallel currency in Mozambique has come to an end. Like the euro and the rand, the greenback will now find its circulation tightly controlled by the Bank of Mozambique, the country’s central bank. In a measure of significance for foreign companies and expatriate workers especially, all bank transactions in dollars, including the payment of wages, will be automatically converted into local currency at the time of the transaction.

The Bank of Mozambique decided on the measures to halt the depreciation of the metical and lessen the influence of foreign currencies in the domestic market. The compulsory central bank measures were communicated to commercial banks on 24 November, Mozambique-based lawyer Paulo Pimenta explained to Portuguese weekly newspaper Expresso.

The measure, ending a de facto two-currency regime, is intended to stimulate demand for the Mozambican currency and raise its value.

Source: Expresso