WINDHOEK – The agreement for currency conversion that is to be signed the Bank of Namibia and the National Bank of Angola (Banco Naçional de Angola), would only allow for the trade at Oshikango and Santa Clara in Angola. “The conversion of the currencies will be applicable only to the border towns of Oshikango and Santa Clara,” Bank of Namibia said. Traders hope that the successful implementation of the currency conversion at the two towns would lead to the widening of the agreement to include other border towns and specific towns with huge volumes of trade between Angolan and Namibian traders.
Bank of Namibia is set to sign a currency conversion agreement with Angolan national bank on 22 September in Santa Clara, the Angolan town mirroring Oshikango across the borderline at Oshikango border post. This agreement would allow Angolan nationals who trade in Namibia to legally bring Angolan Kwanza into Namibia and exchange it into Namibian Dollar for trading purposes. Namibians can also take the Namibian dollar into Angola and exchange it into Kwanza for trading purposes.
The reciprocal conversion of the national currencies of Angola and Namibia would “revive and stimulate trade between the two countries,” as well as “strengthen the economic relations.”
Since 2009 the Namibian business sector, led by the Namibia Chamber of Commerce and Industry, together with a group of pro-active Angolan businesspeople at Oshikango, have been pushing for Namibia and Angola to accept the proposal that eliminate the need for a third currency, the US dollar, saying such a move would increase liquidity and market efficiencies.
Bank of Namibia identified payment systems and currency exchange between Namibia and Angola as one of the trade constraints in a research in 2010/11.
Namibia and Angola have been lagging in ratification and implementation of a number of trade protocols, – at one point Article 10 of the 2004 bilateral trade agreement became so pressing that exports of specific commodities were prohibited from entering Angola overnight and politicians had to work around the clock to resolve the situation. Article 10 of the bilateral Trade and Economic Cooperation Agreement provide for the establishment of Joint Trade Committee (JTC).
The recent bilateral meeting between Angola and Namibia has resulted in a speedy finalisation of the terms of reference of the JTC for it to start functioning. The terms of reference would guide technical officials to look into issues of trade and investment and provide reports for policy guidance and decisions. These issues include market access for export products of both countries, issues surrounding the movement of goods across borders, investment and joint-venture partnerships, amongst others.