It appears that the most popular currencies in Africa are not the ones with the most value. The biggest economies on the continent—like Nigeria, South Africa and Kenya, are being beaten by countries one would not expect.
A new report by global magazine Dey There listed the strongest currencies in Africa, judging them by their performance against the United States Dollar (USD). However, the findings are similar to that of previous numerous looks at African monies.
With a good look at many of these reports, one would find that the most valuable currencies in the continent actually perform better than that from other countries of the world.
The Libyan Dinar sits on top of the ranking with a value of LD 1.4 per dollar. One of the reasons for this currency’s value is a programs by the Central Bank of Libya which sells only a limited amount of dollars to its citizens.
Coming after the Libyan Dinar is its Tunisian counterpart—which is also a dinar. At DT 2.87 per dollar, the currency is strong because Tunisia has in place a well-defined export, import and conversion policy.
In third place is the Ghana Cedi, whose value per 1 USD is GH₵ 5.49. This is somewhat unsurprising because Bloomberg had earlier in the year named the currency as the best performer against the dollar. Also, Ghana is the world’s largest cocoa producer.
The Moroccan Dirham, which is a de facto currency in Western Sahara, comes in fourth place on the ranking with a per-dollar value of MAD 9.89. Such currencies are not a country’s legal tender, but is treated as such by most of its populace.
The fifth strongest currency in Africa is the Botswana Pula, which exchanges P 10.90 to get USD 1. The value of the currency owes it thanks to the Southern African country’s relatively stable democracy and growing economy.
The Zambian Kwacha follows the Botswana Pula, with ZK 13.14 for USD 1. This significant value stems from the fact that Zambia is the largest producer of copper in Africa. Since copper is a commodity, the currency can experience volatility—depending on the shifts in the commodity prices on the global copper market.
Seemingly finishing it off for the lesser-sized economies, the Seychellois Rupee cuts out SR 13.64 for USD 1. This small island—nation which also has the strongest passport in the continent—has a strict monetary policy and a market-based economy.
Image Courtesy: The Conversation