African economic experts call for the need to have an African cryptocurrency and integrated capital market on the continent to improve trading, ease business expenses, and ensure growth post-COVID-19.
Anouar Hassoune, Professor of Finance and CEO of West Africa Rating Agency, said the creation of an African cryptocurrency and integrated capital market would give the continent a sense of identity, lower the cost of business, and help monetise Africa’s natural resources such as gold.
He further said, “We need to come up with a cryptocurrency that is acceptable to each member state. It’s better to do it at the continental level, and we have the expertise to do it. It’s a matter of governance, not an issue of technology”. According to the experts, it is the only way to make the essential reforms possible.
During the African Economic Conference, West African Monetary Institute Economist Augustine Ujunwa said a well-functioning integrated capital market would be crucial for Africa’s growth. According to him, the Africa markets and countries are currently small, and there is a need to adopt a regional approach towards integrating markets. To attain this, we must harmonise the laws, regulations and protocols governing African country’s fintech and digital systems.
He said, “Central banks should go beyond their price stability role and pursue a growth-focused monetary policy. They should begin to think of innovative ways of providing finance for the critical sectors of the economy.”
Emmanuelle Riedel Drouin, the head of the Agence Française de Développement’s Economic and Financial Transition Department, backed the notion of a pan-African cryptocurrency. She did, however, point out a few criteria.
“We should not forget that there is a lot of work to be done on the digital infrastructure. The development of payment systems and interoperability systems needs to be worked on. So, there is a lot of work to be done in collaboration with the financial institutions on digitalisation of delivery and payment channels”, she said.
The panel, led by Marie-Laure Akin-Olugbade, director-general of the African Development Bank (AfDB) for West Africa, also discussed the role of central banks in supporting Africa’s development and Islamic finance.