Zambia to Accept Yuan Payments for Copper Exports From 2027

Zambia plans to accept payments in Chinese yuan for some copper exports from 2027, as Africa’s second-largest copper producer seeks to deepen financial ties with Beijing and reduce reliance on the U.S. dollar.

The arrangement will initially involve Chinese mining companies operating in Zambia, which already pay some taxes in renminbi (RMB), Bank of Zambia Governor Denny Kalyalya said on the sidelines of the International Monetary Fund’s annual meetings in Bangkok this week.

“That’s the starting point,” Kalyalya said. “We also hope that new lending could also be denominated in renminbi. That would help a great deal.”

Zambia is also discussing a potential currency swap agreement with China that could facilitate the use of the yuan in bilateral trade. Settling copper sales in the Chinese currency could help advance those negotiations, Kalyalya said.

The move builds on Zambia’s decision to allow Chinese mining companies to pay some taxes and royalties in yuan, a practice that began in October 2025.

Several major copper operations in Zambia are majority-owned by Chinese companies, including the Chambishi and Luanshya mines, operated by subsidiaries of China Nonferrous Mining Group.

Zambia is one of Africa’s leading copper producers and is seeking to expand output as demand for the metal grows, driven by electrification, renewable energy infrastructure, electric vehicles and data centres. Copper is a key component in power grids, electric motors and the wiring used in digital infrastructure.

Greater use of the yuan could reduce currency conversion costs for companies earning revenue in China’s currency or making payments to Chinese lenders, although the benefits would depend on transaction volumes, exchange rates and access to yuan liquidity.

Zambia’s plans reflect broader efforts by African governments to expand the use of the yuan in trade and debt servicing as economic ties with China deepen.

China is Africa’s largest trading partner and a major source of infrastructure financing, particularly for transport, energy and mining projects. Beijing has also sought to expand market access for African exports as it strengthens commercial relationships across the continent.

Kenya has converted Chinese railway loans from dollars into yuan, seeking to lower debt-servicing costs, while Ethiopia has also discussed similar arrangements with Chinese lenders.

For African borrowers, denominating debt in yuan can reduce exposure to dollar movements when revenues or trade receipts are linked to China. But it can also introduce currency risks if export earnings are received in dollars or other currencies while obligations are denominated in yuan.

The shift comes as several African countries face pressure to manage external debt payments, preserve foreign-exchange reserves and limit the impact of dollar volatility on public finances.

For China, wider use of the yuan in commodity transactions would advance efforts to internationalise its currency and reduce dependence on the dollar in global trade.

China is the world’s largest copper consumer, making its currency and purchasing policies important to producers such as Zambia, Chile and the Democratic Republic of Congo.

Beijing has promoted yuan-denominated trade and financial arrangements through currency swaps, cross-border settlement systems and lending agreements. Greater use of the currency in commodity markets could also strengthen China’s influence over how transactions are financed and priced.

China has sought a greater role in determining commodity benchmarks, including through negotiations with major iron ore producers such as BHP Group. Chinese commodity exchanges have also developed yuan-denominated contracts intended to expand the use of domestic pricing benchmarks in international markets.

The dollar, however, remains the dominant currency in global trade finance, foreign-exchange reserves and commodity markets, supported by its liquidity and the depth of U.S. financial markets.

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