African currencies are known to struggle in the global market but here are the weakest of the bunch.
The currencies of African countries have become a hot topic of debate lately and this has something to do with the recent posturing which could see the continent adopt a single currency in an effort to foster economic integration and better manage the prices of goods and services.
Just recently, the 15 member-states of the Economic Community of West African States (ECOWAS) took a big step by resolving to meet all six convergence criteria set aside to achieve the historic goal of adopting a single ECO currency by 2020.
The criteria, formulated to ensure countries with stronger economies and currencies are treated fairly, include achieving single-digit inflation of 5 percent or less by each country, a fiscal deficit of no more than 4 percent of the country’s GDP, and a central bank deficit-financing of no more than 10 percent of the previous year’s tax revenues, among others.
The adoption of the ECO is a move that is expected to boost cross-border trade in the West African region. And other African regions are starting to get in on the act with the East African community also looking to pull off something similar with the planned economic upheaval of the region.
As it is, a lot of African countries are making strides to unify economies at the regional level, but that can’t be said of many others that are still struggling to maintain the value of their local currencies; something that can be achieved by lowering inflation, trimming down the high cost of living, and improving on the stock exchange market.
Now, here are the weakest/least valuable currencies on the continent measured against the U.S. Dollar which is the most common currency used globally for transactions.
Sao Tome and Principe’s Dobra is the weakest currency in Africa when measured against the dollar. One dollar is equivalent to Db 21.5 K
The Guinean Franc is the second weakest currency in Africa with an exchange rate of a dollar to GNF 9.1 K.
The Sierra Leonean Leone would be done a solid by the West African ECO if it is implemented as planned. But the struggling country would have to meet the criteria set aside and it’s hard to see that happening at the moment, with one dollar valued at SLL 9.1 K.
The Ugandan Shilling has had its struggles and it has failed to shake those off. A dollar is equivalent to UGX 3.6 K.
Since becoming legal tender in 1961, The Ariary has struggled to hold its own in the exchange market. It is currently valued at MGA 3.6 K to a dollar.
Efforts have been made to move the Tanzanian Shilling, also called Shilingi, out of the weak currency zone but slow economic growth has kept it firmly tethered to the bottom of the currency exchange market. The official rate is currently TZS 2.3 K to a dollar.
Featured Image Courtesy: fxssi.com
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