Liberalisation of Foreign Exchange Administration PoliciesRef No : 03/19/05 27 Mar 2019 Embargo : Not for publication or broadcast before 1700 hours on Wednesday 27 March 2019
Bank Negara Malaysia is pleased to announce further liberalisation in the foreign exchange administration (FEA) framework aimed at providing greater hedging flexibility for residents to better manage their foreign exchange (FX) risk:
i. Residents can hedge their foreign currency obligations for longer tenure
Flexibility for residents to hedge their foreign currency obligations is extended to 12 months which would facilitate efficient financial planning by businesses. Residents may also obtain approval from the Bank to hedge their foreign currency obligations beyond 12 months.
This measure is effective immediately.
ii. SME with net import obligations can receive payment in foreign currency from resident exporters
In recognising SMEs’ limited hedging capabilities, SMEs, which are net importers within the global supply chain of goods and services, are allowed to receive foreign currency payment from resident exporters for their domestic trade in goods and services.
This measure is effective 2 May 2019, to provide time for banks to set up this flexibility for eligible SMEs and the resident exporters.
Further details on the above liberalisation are provided in the Supplementary Notice No. 5 on Foreign Exchange Administration Rules issued by the Bank.
Bank Negara Malaysia
27 March 2019
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