THE ROLE OF RESERVE BANK
OF MALAWI IN THE MALAWI
TOBACCO INDUSTRY
Presentation made to the 2013 TCC Annual Seminar.
Bartwell Chingoli, Exchange Control Department
OUTLINE
RBM as a regulator of the financial sector
 Financial intermediation
 Handling of Exports from, the use of
FESDS
 Challenges and Limitations
 QnA

THE REGULATOR OF
FINANCIAL SECTOR
•
•
•
•
Provision of directives and guidelines e.g domestic
lending to ensure financial stability
Consumer literacy
Supervision of commercial banks and other
financial institutions
Processing of foreign exchange remittances on
capital and financial accounts transactions
Financial intermediation
•
•
Monetary policy operations to smoothen the
foreign exchange and domestic money market
Processing and recording Pre-financing deals
• Foreign borrowing is still a controlled item
in Malawi. This is to ensure correct balance
of payment statistics and enable proper
planning for foreign obligation
•
Procurement of major imports (fuel, fertilisers)
which have strong impact on the tobacco industry
HANDLING OF EXPORTS
FROM MALAWI
•
All export consignments have to be
declared in one way or another
• Through MRA Form 38 on all
exports below US$5,000.00
• Through RBM managed foreign
exchange statistical database system
(FESDS) for all other exports
•
Exporters are required to repatriate to
Malawi all export proceeds within 180 days
from the date the consignment was
discharged by MRA
REASONS FOR EXPORT
DECLARATION
•
•
•
Basis for collecting and compiling accurate export
statistics necessary for BoP purpose. This is crucial in
any international trade
For assessing and determining industry worth. To get t
a ratio of 15% as contribution to GDP, there must be
accurate assessment of the sector vis-à-vis the entire
economy.
Essential contribution to monetary policy formulation
WHY USE FESDS – Background
and Rationale
The Foreign Exchange Statistical Database
System (FESDS) is web based foreign
exchange processing facility introduced in
Malawi to mainly remove inefficiencies
relating to manual processing of exports
 Became operational on 28 October, 2008.
 Designed to introduce efficiency in
exports declaration and proceeds
tracking.
 Ensures export proceeds repatriation and

FESDS MODULES AND USE
CD1 Forms Module- this is the part
most important to exporters
 Form E’s-for processing all other foreign
exchange remittances by banks
 FCDA Balances-This is a module being
developed to cover movements in
foreign currency denominated accounts
and will also include all operations of
foreign exchange bureaus

FESDS - Parties Involved

RBM
 user and administrator
 Providing technical and business help desk service
 Ensuring that network traffic to and from FESDS is
not affected by congestion or internal ICT policy
 Acquitting CD1 Forms
 Putting in place necessary legislation to ensure
compliance of FESDS by economic players
 Providing training to FESDS users
FESDS - Parties Involved
(Cont’d)

MRA





users
Clearing exports
Ensuring that exports are not under-valued
Timely discharging of exports in the FESDS as they leav
Providing technical and business service desk to handle
queries
FESDS - Parties Involved
(Cont’d)

Exporters/importers/clearing agents)

Banks – users

MALSWITCH – network provider
CD1 Form Reconciliation Process

Export proceeds must be received in
Malawi within 180 days (6 months) of
export

Banks receive proceeds, capture payment
in FESDS, and advise RBM

RBM checks payment details and acquits
CD1 Form
CHALLENGES/ LIMITATIONS
System connectivity problems
 Over- and under-discharging of exports at
MRA
 Non-reconciliation of exports by
exporters and banks
 We are discussing with banks to ensure full
application of the system
 We have intensified training of FESDs users
to enhance user acceptance

Service desk contacts
MRA service desk: 01 822 588 Ext. 3268/3266 or 01 827
029
RBM service desk: 01 770 600 Ext. 4333/4344
MALSWITCH service desk: 01 820 760/ 01 822 444 Ext.
2064/2094/2021
Thank You!
Since previous presenters
have covered Foreign
Exchange issues in detail,
Are any More Questions?