Government has clarified that the decision to allow the payment of some mining taxes in the Chinese currency, Renminbi also known as Yuan, is a strategic and cost-saving measure aimed at improving debt management and reducing foreign exchange conversion costs. Minister of Finance and National Planning, Situmbeko Musokotwane, says the measure should not be interpreted as a shift away from the Zambian Kwacha, which remains the primary legal tender for domestic transactions. Speaking during a media briefing in Lusaka, Dr Musokotwane said the clarification was necessary following widespread public and regional interest after reports emerged that Zambia had begun collecting mining taxes in Renminbi.
The Minister explained that taxes in Zambia are ordinarily payable in Kwacha, but the government may, from time to time, designate other currencies for specific sectors for macroeconomic stability reasons. He cited the 2018 decision, later expanded in 2020, which required mining companies to pay certain taxes in United States Dollars. Dr Musokotwane said the same strategic logic now applies to the limited use of the Renminbi.
He further disclosed that in 2025, about 75 percent of mining taxes were paid in USD, approximately 25 percent in Kwacha, and about 2 percent in Renminbi. Dr Musokotwane added that looking ahead to 2026, the government expects around 60 percent of mining taxes to be paid in USD, about 25 percent in Kwacha, and approximately 15 percent in Renminbi. The Minister stressed that China remains Zambia’s largest bilateral creditor and that most loans contracted from China were denominated in Renminbi and not USD.
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“When it is time to service that debt, repayment is required in the same currency that was borrowed. Allowing a portion of taxes to be paid in Renminbi enables the government to avoid unnecessary conversion costs,” Dr Musokotwane said. He noted that converting USD into Renminbi attracts transaction costs and settlement delays, which the government seeks to minimise through this approach. The Minister emphasised that the arrangement is limited and targeted, currently applying to a small number of mining companies with strong links to China, and does not compel all mining firms to pay taxes in Renminbi.
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