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BEAC launches Control Operation against Illicit Capital flight

The Bank of Central African States (BEAC) has just launched a control operation intended to clear the domiciliation of imports of goods and services.The deficit on the Central Bank’s foreign exchange reserves and the flight of capital led the issuing institute of the six countries of the Cémac zone (Gabon, Congo, RCA, Chad, Equatorial Guinea, Camero on) to initiate a control at the end of which the culprits will be punished.

Observers evoke a wind of panic blowing on the roof of those subject to the exchange regulations of the BEAC. The clearance process for the domiciliation of imports of goods and services means that the Central Bank asks all economic agents resident in the sub-region, having taken out foreign currency to import goods and services, to provide proof that they are these have actually arrived in the sub-region, in proportion to the currency released.

The Bank thus hopes to get its hands on the operators who are at the origin of the current account deficit observed during fiscal year 2020. If the exact figures of this deficit are not communicated, the media are still talking about a considerable deficit which has led, in recent months, to a reduction in the coverage rate of the currency from 5 to 10 points.

It should be remembered that since March 2019, a new currency regulation has been adopted by the members of Cémac, in order to fight against the uncontrolled outflow of capital. Member States have mandated their Central Bank to restrict foreign currency payments to individuals and businesses in these member countries. To date, all sectors of the economy without exception will be subject to the new regulations.

These measures require, for example, that for any transaction of more than one million CFA francs outside the zone, approval from the banking authorities is required. Businesses and individuals must now also receive authorization from the Central Bank before opening an account outside the region. This restriction is not welcomed by economic operators, denouncing the arbitrary power of the Bank.