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Finance - December 31, 2021

5 Weakest Currencies in Africa Against the Dollar

Africa’s largest economy Nigeria by GDP has been trying to keep its currency’s value and preserve relative exchange rate stability for years. 

 The COVID-19 pandemic has fueled the weakening of most Currencies in Africa when compared to the US dollar, Euro, and British Pound which is mostly used for international trade exchange. However, most of the currencies in Africa were already proven to be weak before the pandemic hit the world.

Africa’s largest economy Nigeria by GDP has been trying to keep its currency’s value and preserve relative exchange rate stability for years. While this battle hasn’t produced much, it’s worth noting that Nigeria’s currency crisis isn’t the worst on the continent.  

Here are the 5 weakest currencies in Africa that have weakened in comparison to the US dollar.

Sao Tome and Principe Dobra (21,186 STD – 1 Dollar) 

The Sao Tome and Principle Dobra (STD) is currently Africa’s weakest currency. The country is the continent’s smallest.

 The two-island state’s main sources of revenue are cocoa, coffee, and coconut exports. However, this is insufficient to keep the local economy afloat. 

Sierra Leonean Leone (11,335 Leone – 1 Dollar)

Due to the civil war and economic hardships, Sierra Leone has a high rate of inflation. The currency has been severely affected by the Ebola virus and the COVID-19 outbreak.

Guinean Franc (9,325 GNF – 1 Dollar)

Guinea has one of the most devalued currencies among African countries. Franc is weak due to excessive inflation, rising poverty.

Given the country’s natural riches, of Gold, diamond, and aluminium, Guinea should have been among the countries with the most valuable currencies. Guinea is the world’s top bauxite exporter and possesses the world’s largest bauxite reserves.

Malagasy Ariary (3,965 – 1 Dollar)

Because of the high inflation rate in Madagascar, the currency continues to depreciate against the dollar.

The country operates a  market economy where agriculture, the emerging tourism, textile and mining industries are the mainstay. Madagascar produces tropical staple crops such as rice, cassava, vanilla and coffee. 

Ugandan Shilling (3,544 Ugandan Shilling – 1 Dollar)

Uganda’s central bank (Bank of Uganda), announced in August that the currency had devalued by 3% against the US dollar in the first five months of 2020 as a result of increased investor withdrawals following the Covid-19 outbreak.

READ MORE: Why the US Government Seized $1.2 Billion Cryptocurrency in 2021

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