A Business and Financial Adviser is concerned with business entities that have continued quoting and setting business transactions in United States Dollars. Mr. Kingford Kalobi said that most businesses, especially in the real estate market, have taken advantage of the depreciating local currency against the dollar.
Charging in foreign currency, specifically dollars, is illegal and I would just urge the central bank to step in,Kalobi.
He added that in 2019, the Bank of Zambia issued an instruction that all businesses should charge for their goods using the local currency. Mr. Kalobi added that if allowed to continue, the trend has potential to lead it to multiplicity of exchange rates which may differ significantly from competitive market rates, thereby destabilizing the orderly functioning of the foreign exchange market.
Meanwhile, Financial Analyst Maambo Hamaundu said it is important to qualify the statement in terms of whether businesses are receiving in dollars when they are transacting; a case which is illegal because the functional currency is the kwacha.
There are some businesses that peg their prices against the dollar, some businesses peg their prices against the dollar because their stocks are denominated in dollars when importing,Hamaundu.
He further said it is important to monitor the dollar/kwacha rates for these businesses to survive, but doing actual transactions in order for businesses to survive.