Zambia has made history by becoming the first African country to formally accept China’s yuan for mining taxes and royalties. The move, confirmed by the Bank of Zambia, allows mining companies, especially those owned or financed by Chinese firms, to pay part of their tax obligations in yuan rather than exclusively in U.S. dollars.
This decision reflects shifting economic realities. China is Zambia’s largest copper buyer and one of its biggest investors in the mining sector. Allowing taxes to be paid in yuan reduces currency conversion costs, eases pressure on dollar reserves, and aligns government revenue collection with the currencies already circulating in the mining industry.
To support the policy, the Bank of Zambia has begun publishing an official yuan-to-kwacha exchange rate, giving companies flexibility when settling their tax bills. Supporters argue this move strengthens foreign exchange management and helps Zambia better service Chinese debt without unnecessary currency losses.
However, the decision also underscores China’s growing financial influence in Africa. Currency is more than money. It represents economic power and long term alignment, bringing both opportunities and risks.
Do you see this as a smart economic move for Zambia, or a step that could reshape Africa’s financial future in ways we are not fully prepared for?
2 Comments
In my understanding, due US dominant in Africa, collecting Mining taxes in yuan instead of dollar, it will reduce dollar reserve, as result of kwacha depreciation against dollar, and this will make imported Good to become expansive , due to those other Foreign country , we import Goods from are currently accepting US dollar not yuan on their Goods.
Unless may be Zambia is Going to be an example for all African country to start changing slow start changing international trade currency, as Zambia striped in earlier
My thinking, Currently the Chinese Government has invested signficantly in Africa and Yuan will be an accepted trading currency soon. Zambia has just pioneered the idea. However this does not mean they will nolonger accept or trade in the US currency