Kenya reaffirms calls for African countries to abandon the dollar

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Kenya reaffirms calls for African countries to abandon the dollar,Kenya’s President William Ruto has asked African leaders to take first steps towards ditching the globally-bullish US dollar by signing up to a pan-African payments system to facilitate trade within the continent.

Dr Ruto has urged his peers in Africa to mobilise central and commercial banks to join Pan-African Payments and Settlement System (PAPSS) which was launched in January 2022.

The system for intra-African trade was developed by African Export-Import Bank (Afreximbank) and African Continental Free Trade Area (AfCFTA) Secretariat. The initiative was backed by the African Union and African central banks.

“We are all struggling to make payments for goods and services from one country to another because of differences in currencies. And in the middle of all these, we are all subjected to a dollar environment,” Dr Ruto told a forum of government and private sector officials attending a forum on AfCFTA in Nairobi on Monday.

“There has been a mechanism where all our traders can trade in the local currency and we leave it to the Afreximbank to settle all the payments. We do not have to look for dollars; our businessmen will concentrate on moving goods and services, and leave the arduous task of currencies to Afreximbank.”

African traders and their local banks are using correspondent banks, usually in the US and Europe, to complete payments between two African currencies largely in dollars, and sometimes the Euro.

Kenya reaffirms calls for African countries to abandon the dollar
Kenya reaffirms calls for African countries to abandon the dollar,President William Ruto making his remarks during the African private sector dialogue conference on the African Continental free trade area (AFCFTA) at Safari Park Hotel, Nairobi on May 29, 2023. PHOTO | LUCY WANJIRU | NMG

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