NAIROBI, Aug. 30 (Xinhua) -- The African Export-Import Bank (Afreximbank) said on Wednesday that the continent is benefitting from the use of local currencies when engaging in intra-African trade.
Denys Denya, Afreximbank's executive vice president for finance, administration and banking services, said at a roadshow in the Kenyan capital of Nairobi that foreign currencies, such as the U.S. dollar which is traditionally used for cross-border trade, are currently in short supply in the continent.
"The use of local currencies for trade within Africa is easier for both large and small entrepreneurs because they don't need to source foreign currencies," Denya said during the Intra African Trade Fair 2023 Business Roadshow.
He added that the use of local currencies has numerous advantages because it limits the possibility of extraterritorial sanctions by the owners of the third-party currencies.
Denya said the use of local currencies also boosts trade among African countries because dollars are only required to settle net differences in trade.
He noted that intra-African trade is made possible by the Pan-African Payment and Settlement System, which was developed by the Afreximbank and is owned by African central banks.
The Afreximbank is a pan-African multilateral trade finance institution created in 1993 and is headquartered in Cairo, Egypt. According to the bank's website, its purpose is to stimulate a consistent expansion and diversification of African trade so as to rapidly increase Africa's share of global trade.
