According to the Banco de Nacional de Angola, Angola's central bank, the amount of dollars sold at auctions by the central bank has been halved due to a foreign exchange law. From USD400 million in June, the amount has dropped to USD200 million.
Last year, Angola passed a law requiring foreign-owned companies to use local currency to pay taxes beginning May of this year. Angola earned an extra USD25 billion from the USD116 billion oil economy. Antonio Andre Lopes, a vice-governor of the Banco de Nacional de Angola, said that this law helped boost the kwanza supply in the Angolan market. The kwanza is Angola's national currency.
Angola is Africa's second-largest oil producer. "While there is pressure to make the kwanza a traded currency," Lopes said, "we need to think about the impact this will have on stability." Neighboring countries like the Democratic Republic of Congo and Zambia, however, use the kwanza informally and nonetheless had generated demand for international trading.
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