Forex change: a traveller’s dilemma
Adéṣẹ́gun Ọṣìbánjọ
For a lot of African travellers, embarking on a journey throughout the continent is an thrilling enterprise till they face the irritating actuality of a number of foreign money conversions.
Take, for instance, 2AO, a Lagos-based vacationer travelling to Nairobi. Earlier than departure, 2AO should change Naira for U.S. {dollars} in Lagos after which convert the {dollars} to Kenyan Shillings upon arrival. On the return journey, the method repeats, including pointless {financial} pressure and inconvenience.
These inefficiencies don’t merely create inconvenience, they reinforce Africa’s dependence on foreign exchange, such because the U.S. greenback and the Euro. Each transaction that requires conversion into {dollars} strengthens exterior economies on the expense of African currencies, decreasing their world worth and making Africa’s {financial} system much less aggressive.
The introduction of a single African foreign money would eradicate these limitations, making journey inside Africa way more seamless and inspiring African residents to discover their continent with out pointless {financial} burdens.
Commerce and SMEs: Breaking Free from Overseas Intermediaries
Past tourism, the necessity for a unified foreign money is felt deeply in commerce. African companies proceed to depend on expensive international {financial} intermediaries for transactions throughout borders. Nigerian merchants exporting items throughout Africa should navigate Kind M or import license processing, worldwide funds transfers, and letters of credit score are all dealt with via European and American banks.
This technique creates main {financial} inefficiencies, together with: Excessive transaction prices, Sluggish processing occasions, and Trade fee dangers.
For Small and Medium enterprises (SMEs), this weakens competitiveness, making cross-border commerce unnecessarily advanced and costly. A single African foreign money would enable companies to conduct transactions instantly, decreasing prices and simplifying processes, boosting intra-African commerce whereas rising African {financial} autonomy.
Moreover, African nations endure from change fee volatility, which impacts costs and complicates commerce agreements.
Eradicating dependency on exterior currencies and permitting companies to transact instantly in a unified African foreign money would result in higher worth stability, {economic} progress, and elevated investor confidence in African markets.
Championing Intra-African Commerce
Nigeria’s Minister of Industry, Trade, and Investment, Dr. Jumoke Oduwole, has been a steadfast advocate for Africa’s {economic} integration, significantly via the African Continental Free Commerce Space (AfCFTA). Alongside fellow African Ministers of Commerce, she has labored tirelessly to eradicate commerce limitations and place Nigeria as a driving pressure in intra-African commerce.
A significant problem in AfCFTA’s implementation is the absence of a single African foreign money, which complicates transactions throughout borders. At the moment, companies should navigate a number of change charges, rising transaction prices and limiting the fluidity of commerce. This reliance on exterior {financial} establishments for foreign money conversions weakens Africa’s {economic} sovereignty, making commerce inside the continent costlier and fewer aggressive.
Dr. Oduwole has harassed {that a} unified foreign money can be a transformative step in making a seamless commerce ecosystem. With out it, African companies face delays, {financial} losses on account of fluctuating change charges, and difficulties in establishing predictable pricing fashions. The dearth of a single foreign money additionally hampers the effectiveness of the Pan-African Fee & Settlement System (PAPSS), an initiative designed to facilitate swift and cost-efficient funds throughout African nations.
Regardless of these challenges, Nigeria stays dedicated to AfCFTA’s aims, working to reinforce regional fee programs and strengthen commerce insurance policies that minimise foreign money volatility. Via initiatives such because the Guided Commerce Initiative, Nigeria continues to pursue sustainable options that can cut back {financial} limitations and promote a very built-in African market.
Dr. Oduwole’s imaginative and prescient stays clear: an Africa the place companies thrive with out {financial} constraints, and the place African nations, not exterior forces, drive commerce.
Overcoming Divide-and-Conquer Methods
Regardless of the clear advantages of a unified African foreign money, vital obstacles stay. The West’s centuries-old ‘Divide-and-Conquer Technique’, born from the 1884 Berlin Convention, nonetheless performs a task in protecting Africa economically fragmented.
For many years, African leaders have been incentivised to take care of {economic} division, not as a result of it advantages their residents, however as a result of it serves the pursuits of Western economies. By protecting African economies disconnected and depending on international {financial} buildings, exterior entities preserve management over Africa’s pure assets, commerce routes, and wealth creation.
The carrot-and-stick strategy stays a key device of management:
African leaders who preserve division are sometimes rewarded via {financial} and political help.
READ ALSO: Nigeria Submits AfCFTA Tariff Supply, Commits to 90% Responsibility-Free Commerce Throughout Africa
Leaders who push for unity and self-sufficiency steadily face opposition, {economic} sanctions, or political instability engineered from overseas.
A single African foreign money disrupts this method, making it more durable for international {financial} establishments to dictate the {economic} trajectory of African nations.
This is the reason opposition typically emerges from inside African governments themselves—leaders afraid of shedding international {financial} backing steadily block initiatives that promote unity.
This marks the second merchandise on the African Residents’ Expectations Agenda of the Africa Woke Residents Platform (AWCP) despatched to the African Union Fee (AUC), pushing for public dialogue and transparency on Africa’s {financial} independence. The individuals of Africa are waking as much as the necessity for true {economic} sovereignty, and the demand for motion is rising louder.
Breaking the Barrier
To face up to exterior pressures, Africa’s main economies should rise as continental Hegemons, fostering unity, deepening cooperation, and championing {financial} sovereignty.
Nations akin to Nigeria, South Africa, and Egypt should assume accountability for main Africa’s {financial} transformation. They have to: Strengthen the African Union’s institutional framework, Develop {economic} synergies throughout borders, Promote political and {economic} stability throughout the continent.
By fostering collaboration, these nations can construct a powerful African {economic} bloc, decreasing dependency on Western {financial} establishments. Their management should transcend symbolic gestures—it should translate into concrete coverage actions, together with: Establishing a unified {financial} system, Enhancing intra-African commerce agreements, Facilitating funding alternatives throughout borders.
With out decisive management, Africa dangers remaining fragmented, unable to totally capitalize on its ample assets, entrepreneurial dynamism, and industrial potential. A powerful African-led {financial} framework would give Africa higher leverage in world negotiations, securing {economic} sovereignty and eradicating exterior {economic} management.
Uniting Africa In the direction of {Financial} Independence
The institution of a single African foreign money is each formidable and crucial, one that might take away limitations, empower African companies, and increase tourism.
As Dr. Oduwole and different champions of African commerce proceed their advocacy, momentum is constructing towards an Africa that controls its {economic} future.
This shift goes past {financial} advantages; it represents Africa’s rightful place within the world economic system. Not ought to African nations be compelled into fragmented, inefficient commerce programs that serve international pursuits. Not ought to African residents endure {financial} hardships from a system designed to restrict their {economic} freedom.
The period of counting on international establishments to dictate Africa’s future should come to an finish. The one African foreign money might be the turning level, a chance to unify Africa financially, create stronger commerce hyperlinks, and set up a self-sustaining African economic system for generations to return.
God bless Africa!!!
Adéṣẹ́gun Olútáyọ̀ Adéolú Ọṣìbánjọ is the convener, Africa Woke Residents Platform (AWCP).
