Zambia has taken a significant step by becoming the first African nation to accept the Chinese yuan for tax and royalty payments from Chinese mining companies. According to NS3.AI, this decision marks a regional shift away from the US dollar and aligns with China's broader strategy to internationalize the yuan and expand its influence in Africa. This move is part of China's Belt and Road Initiative, which aims to strengthen economic ties with African countries.
The Bank of Zambia is also diversifying its foreign reserves by holding a substantial portion in yuan, further challenging the dominance of the US dollar in the region. This strategic decision reflects Zambia's growing economic relationship with China and highlights the increasing importance of the yuan in global trade and finance.