Angolans desperate for forex seek euros | Fin24
 
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Angolans desperate for forex seek euros

Nov 20 2015 17:15
Henrique Almeida, Renee Bonorchis and Candido Mendes

Luanda - Some Angolan banks running low on dollars are offering customers euro notes and other foreign currencies after a distributor said it could no longer supply US cash.

“We are advising our clients to use more euros, rands and even renminbi,” said Fernando Teles, chief executive officer of Banco BIC SA, Angola’s biggest private bank by branches.

Some customers with dollar accounts may convert their money into euros before making a cash withdrawal, he said.

The euro may soon become a major foreign currency in Africa’s second biggest oil-producing country, according to Teles, a transition that could be supported by Angola’s historical links with Portugal, from which it gained independence in 1975.

Imported goods

In Angola, which has seen its own currency depreciate by more than 34% to an official rate of about 135 to the dollar this year, greenbacks are used to buy cars and houses and imported goods. On the streets of Luanda, with supply drying up, $1 is now worth as much as 270 kwanza. That’s a 17% increase from the black market rates in September when $1 was valued at 230 kwanza.

“There will be foreign currency on the street, including dollar bills, but the tendency is for clients to use more credit cards and carry out more bank transfers,” Teles said and Angolan lenders are discussing several solutions to the shortage of dollars.

Rand Merchant Bank, a unit of Johannesburg-based FirstRand, has a representative office in Luanda and said on November 13 it would have to stop providing dollars to lenders in that country by the end of the month.

The South African bank said it was notified late in October by the US lender providing the currency “that it would be discontinuing the supply of cash notes to RMB.”


angola  |  africa  |  economy
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