NAIROBI, Kenya, May 29 – President William Ruto has urged African countries to adopt local currencies as modes of payment to boost trade.
The use of the dollar, the head of state said, is restricting trade within the continent amid the scarcity of the American currency due to high demand.
Adoption of local currencies for intra-Africa trade is still low, with countries only accepting the dollar, which is accepted globally.
Inadequate dollars have seen regional currencies face pressure from the greenback, leading to currency depreciations.
“I think it is important for the Trade Ministers who are here. We are all struggling and all our businessmen are struggling and our traders are struggling to make payments for goods and services from one country to another because of differences in currencies,” President Ruto said while addressing the African Private Sector Dialogue on the African Continental Free Trade Area in Nairobi.
“And in the middle of all these we are all subjected to a dollar environment. Kenyans want to pay for Tanzanian goods in Dollar, Tanzania want to pay for DRC goods in dollars…..Why are we bringing dollars in the middle of our trade. This is the question we should be asking ourselves,” Ruto added.
For a long time, dollar shortages have impeded commerce on the continent due to a lack of a laid-down payment system.
However, Ruto said the Africa Import-Export Bank (Afreximbank) has introduced a new system that allows countries to trade with their own currencies seamlessly.
“And in the process all of our business people are stranded. Egypt cannot pay for our tea because they are looking for dollars. We cannot pay for their sugar because we are also looking for dollars,” Ruto stated.
“And I had a conversation with President Oramah of the AFREXIM Bank and they have built a mechanism where all our traders can trade in the local currency and we leave it to the Africaeximbank to settle all the payments in local currency,” he added.
“We do not have to look for dollars. Our businesspeople, traders will concentrate on moving goods and services and leave the arduous task of currencies to Afreximbank.”
