Bloomberg reported that Chinese mine operators are now settling part of their tax obligations in yuan, reflecting the growing role of China as both Zambia’s biggest copper buyer and one of its largest creditors.
The central bank said the change aligns with its reserve-management strategy and export realities.
“A large portion of copper exports go to China and the Chinese mining firms already receive some, if not all, of their payments for their exports to China in renminbi,” the Bank of Zambia said.
“The Bank of Zambia has the diversification and building-up of its reserves as a key objective, and purchasing renminbi enables the bank to actualize this objective.”
China’s mining money meets Africa’s currency shift
Business Insider Africa reported in October that Kenya converted part of its Chinese debt into yuan, a move aimed at easing pressure on its debt-stretched finances.
The country expects to save about $250 million a year after restructuring its $5 billion railway loan from the Export-Import Bank of China into yuan-denominated debt.
To support the change, the Bank of Zambia last month began publishing an official renminbi-kwacha exchange rate, allowing mining companies to choose whether to sell dollars or yuan to pay taxes.
The shift to yuan payments signals that China’s influence in Africa’s mining economy is now being matched by its growing currency footprint.