Keypoints:
- Zambia is the first African country to accept yuan for mining tax payments
- Policy reflects deepening trade and debt ties with China
- Move highlights Africa’s cautious shift away from dollar dependence
ZAMBIA has become the first African country to accept China’s currency, the Chinese yuan, for the payment of mining taxes and royalties, marking a landmark shift in how a major resource economy manages fiscal revenues, foreign exchange and strategic partnerships.
The change was confirmed by the Bank of Zambia, which said Chinese mining companies operating in the country have begun settling part of their tax obligations directly in yuan rather than converting proceeds into US dollars. Payments in renminbi started in October 2025, according to officials, following months of technical and regulatory preparations.
‘A large portion of Zambia’s copper exports go to China, and many mining firms already receive some, if not all, of their export earnings in renminbi,’ the central bank said in a statement. ‘Allowing tax payments in yuan helps align fiscal flows with trade realities and reduces unnecessary currency conversion.’
Copper, China and currency strain
Mining is the backbone of Zambia’s economy, with copper accounting for more than 70 percent of export earnings and a significant share of government revenue. China is Zambia’s largest buyer of copper and one of its most important investors and creditors, particularly through state-backed mining and infrastructure projects.
By accepting yuan for mining taxes, authorities aim to ease pressure on limited US dollar liquidity, lower transaction costs for exporters and strengthen reserve management. Officials say the policy applies primarily to firms with substantial exposure to Chinese trade or ownership structures.
‘This is a practical response to how mining revenues are earned today,’ a Lusaka-based mining executive told local media on condition of anonymity. ‘It reduces friction in the system and reflects where demand for Zambia’s copper actually comes from.’
Part of a wider de-dollarisation debate
While several African central banks hold small amounts of yuan in their reserves, Zambia is the first country on the continent to formally integrate the Chinese currency into tax collection for a strategic sector. Analysts say this elevates the yuan from a trade settlement currency to a quasi-fiscal instrument.
The move comes amid a broader global debate over de-dollarisation, as emerging economies explore ways to reduce reliance on the US dollar for trade, debt servicing and reserves. China has actively promoted the international use of its currency, particularly in commodity trade and Belt and Road-linked financing.
‘Zambia is signalling that its fiscal systems must adapt to shifting global trade patterns,’ said a regional economist. ‘But it is also taking on new currency exposure, which carries both opportunities and risks.’
Safeguards and concerns
Zambian authorities insist the policy does not undermine fiscal transparency or monetary sovereignty. Yuan-denominated payments will be converted and recorded under existing public finance rules, with the central bank managing the currency as part of its reserve diversification strategy.
However, critics caution that deeper reliance on a single external currency could limit flexibility if economic or geopolitical tensions arise. Some opposition figures have also urged the government to ensure that the policy does not weaken oversight of mining revenues, a historically sensitive issue in Zambia.
Parliamentarians supporting the move have described it as forward-looking but stress the need for clear safeguards. ‘This must serve Zambia’s long-term interests, not just short-term liquidity relief,’ one lawmaker said.
A signal watched across Africa
Zambia’s decision is being closely watched across Africa’s mining belt, particularly by countries with heavy Chinese investment in copper, cobalt, lithium and manganese. While few are expected to follow immediately, the move may prompt renewed debate about currency diversification in resource-dependent economies.
For Zambia, the step underscores how mineral wealth, debt dynamics and shifting global power balances are reshaping fiscal policy choices across Africa.
