By Enyichukwu Enemanna
Malawi has ordered foreign tourists to pay for their hotel accommodation in dollars, euros and other hard currencies as the Southern African nation makes efforts to top up dwindling foreign reserves, Finance Minister Joseph Mwanamvekha said on Friday.
During his mid-year budget review, the Minister said foreign reserves had come under pressure since the International Monetary Fund’s Extended Credit Facility was terminated earlier this year.
This was further worsened by the cut in budget support by some foreign donors.
Under the new initiative, tourism businesses were told to apply for special licences to let them handle foreign exchange directly with the central bank.
According to Mwanamvekha, the steps will help save every dollar and close loopholes.
Exporters will also get less time to bring their earnings home, standing at 90 days instead of 120 and will have to handover part of any leftover foreign currency to authorities after paying for their imports.
The government is also placing a ban on short-term foreign-exchange derivatives, complex contracts banks use, aiming to protect against moves in the kwacha, saying some players have abused them.
It will only allow such products again once tighter rules are in place.
