CAN THE AFRICAN LOCAL CURRENCIES HAVE VALUE IN THE GLOBAL MARKET

In March 2013, Africa was identified as the world’s poorest inhabited continent: Africa’s entire combined GDP is barely a third of the United States’ GDP; however, the World Bank expects that most African countries will reach “middle income” status (defined as at least US$1,000 per person a year) by 2025 if current growth rates continue. In 2013, Africa was the world’s fastest-growing continent at 5.6% a year, and GDP is expected to rise by an average of over 6% a year between 2013 and 2023. In 2017, the African Development Bank reported Africa to be the world’s second-fastest growing economy, and estimates that average growth will rebound to 3.4% in 2017, while growth is expected to increase by 4.3% in 2018.  

Wisdom King Adukpo believes that one way of achieving this feat is if the African currencies are strengthened through improved mutual trade between the continent and other economies. The present state of the over dependence on importation without corresponding exportation is taking a tow on most African economies. Wisdom states:

“I believe it’s time we begin to look at establishing more industries with the free zone approach so that the African continent can also venture into the export market. Having been in the commodity business for over ten years, Tiwala Markt imports so much commodities each year to serve our growing consumer’s demand, in most of these imports, we depend hugely on the US dollar, this makes the demand on the dollar higher than the demand for the local currencies.”

Tiwala Markt believes if they can begin to look at growing some of the commodities locally, it will not only give strength to the local currency through trade, but it will also create employment for a lot of people, thereby reducing poverty on the continent.

This can not be achieved exclusively, the company will need the support of it’s foreign partners to make this possible. There is a need to look at more collaborations, more trade partnerships, with Africa not serving the role as consumers only but equally as manufacturers and exporters.

It is only by doing this that the local currency can have international value and also increase local circulation. If the local currency began to have some purchasing power as a result of the manufacturing of essential commodities locally, then and only then  will local businesses stop the demand of foreign currencies for local services.