20000405

SBP removes curbs

on diplomats'

forex accounts

RECORDER REPORT

KARACHI: The State Bank has restored the facility of opening and maintaining of foreign currency accounts by diplomatic missions, diplomatic officers, and home based staff as also international organisations and their expatriate employees.

The Bank has issued a circular on Tuesday announcing more relaxation in the foreign exchange movement.

Banks maintaining these accounts as well as offering custodial services to such investors are now free to allow outward remittances without State Bank's prior approval ftom disinvestment proceeds, dividend and brokers' commission for transactions.

This new move for diplomatic missions and International organisations will further remove all hurdles in the way of easy movement of the foreign exchange.

Following is the text of the FE Circular No 4 dated April 3, 2000:

"Attention of Authorised Dealers is invited to the instructions issued vide F.E. Circular Nos. 18, 19 and 21 dated the 5th July, 8th July and 27th September, 1999 respectively in terms of which the facility of foreign currency accounts as described in Chapter VI of the Manual and F.E. Circular No. 25 of 1998 was withdrawn in respect of diplomatic missions and international organizations etc. Subsequently, some relaxations were made in connection with opening of special foreign currency account by them and withdrawal of foreign currency notes from such accounts.

"The matter has since been reconsidered and it has been decided to withdraw all the restrictions imposed vide above mentioned F.E. Circular. Consequently, the facility of opening and maintaining of foreign currency account by diplomatic missions, diplomatic officers, and home based staff as also international organisations and the expatriate employees under Para 1(a) Chapter VI and F.E. Circular No. 25 of 1998 is restored. Further, the restriction regarding sale and purchase of foreign exchange by them in the interbank market imposed vide the last sentence of Para 9 of F.E. Circular No. 17 of 1999 is also withdrawn.

"All the amendments made in Chapter VI and XVI of the Foreign Exchange Manual, Seventh Edition, 1992 through the F.E. Circular mentioned above also. stand cancelled."