[ad_1]
- Despite Nigeria’s naira depreciation, it is not among the top 10 weakest currencies in Africa
- The Sierra Leonean’s leone is the weakest currency in Africa and the fourth weakest currency in the world
- Foreign investors, tourists and governments of other countries are affected by a country’s currency movement
The exchange rate is still a significant issue because it depends on macroeconomic expansion. Its movements play a significant role in defining trade and money flow dynamics as well as the decisions made by people, corporations, and the government.
They also decide how much different currencies are worth in comparison to one another.
As international trade flows have grown significantly over the past few decades, affecting trade volume and the current account, the elimination of trade and policy obstacles has contributed to the growth of global trade.
Photo credit – Tudek Ngoro, Hale Weneme
Source: Getty Images
This has furthered the significant relationship between the exchange rate and global economic relations, making it one of the most closely followed globally.
Beyond local companies and governments, the effects of an unstable currency can affect visitors, foreign investors, and other governments. For investors hoping to profit from foreign exchange trading, changes in exchange rates can present a chance.
A greater currency value makes a nation’s exports more expensive and its imports less expensive in international markets, thereby worsening the nation’s trade balance.
On the other side, a lower currency value raises a nation’s import costs while lowering its export costs on international markets, increasing a nation’s trade balance.
Nigeria and several other African nations have recently struggled with dwindling exchange rate caused by significant economic decisions. It’s noteworthy to note that the most populous nation in Africa does not even rank among the ten nations with the weakest currency.
From weakest 10, Legit.ng presents countries in Africa with weakest currency relative to the US Dollar according to data tracked by trading economics as of 18th July 2023.
1. Sierra Leone (1 USD = 19995.0 SLL)
The Sierra Leonean’s leone is the weakest currency in Africa and the fourth weakest currency in the world according to Forbes. The currency was first introduced in 1964.
The west African nation, which borders Liberia and Guinea, exports timber as well as minerals like gold, diamonds, and industrial metals. More than 40% inflation, considerable debt, a slowdown in economic growth, and long-term impacts of the Ebola crisis have all reduced the value of the leone.
2. Guinea (1 USD = 8509.00 GNF)
The Guinean franc is the second weakest currency in Africa. The currency introduced in 1959 is ranked the eighth weakest currency in the world.
Guinea is a former French colony in sub-Saharan Africa. The country has an abundance of natural resources such as gold and diamonds. However, it has struggled with high inflation, military unrest and an influx of refugees from neighbouring Liberia and Sierra Leone.
3. Madagascar (1 USD = 4430.00 MGA)
Madagascar ariary is the third on the list of weakest currency in Africa. The currency replaced the Franc as the official currency on January 1st, 2005
India and East Africa are connected through the island nation of Madagascar. Madagascar exports more than 25% of its GDP in the form of primarily agricultural, forestry, and fisheries goods due to its island status.
4. Uganda (1 USD = 3665.00 UGX)
The Ugandan shilling, first issued in 1966 and is ranks on 4 on the list of weakest currency in Africa as shown by recent data.
East African landlocked nation of Uganda is bordered by the Democratic Republic of the Congo, South Sudan, Kenya, Tanzania, and South Sudan.
Oil, gold, and coffee are all abundant in the nation, but its economy has been plagued by erratic economic development, significant debt, and political upheaval.
5. Burundi (1 USD= 2806.96 BIF)
The Burundian franc, an official legal tender in Burundi is ranked no 5 on Africa’s weakest currency list. The country began issuing its own fran in 1964.
Burundi is bordered on the southwest by Lake Tanganyika and is surrounded by Rwanda to the north, Tanzania to the east, the Democratic Republic of the Congo to the west, and Tanzania to the east.
According to the World Bank, Burundi has a low-income economy and 80% of its people work in agriculture.
6. Congo 1 USD = 2476.00 CDF
The national currency in DRC is the Congolese Franc (CDF) created in 1997, replacing the Zaïre.
Mineral reserves are the principal economic resource of the nation; about 90% of exports are derived from mining.
More than three-fourths of the workforce is employed in agriculture, animal husbandry, fisheries, and forestry, which also generates more than two-fifths of GDP on average.
7. Tanzania (1 USD = 2440.00 TZS)
The Tanzanian shilling replaced the East African shilling on 14 June 1966.
A few of the key sectors of Tanzania’s economy are tourism, mining, and agriculture. Despite employing the bulk of the population, just 25% of the country’s GDP is made up of the agricultural sector.
8. Rwanda (1 USD = 1159.60 RWF)
The Franc became the foreign money of Rwanda in 1916.
Rwanda is a heavily agricultural nation, with 70% of the population working in agriculture. The economy is mainly dependent on the production of tiny, dispersed, semi-subsistence farms, and the main exports are tea and coffee.
9. Malawi (1 USD = 1043.020 MWK)
The Kwacha is the official currency in Malawi since 1970.
Since it is one of the least developed nations, Malawi’s economy is primarily based on agriculture, and about 90% of its citizens reside in rural areas. About 40% of the GDP and 88% of export earnings come from agriculture.
10. South Sudan (1 USD = 979.067 SSP)
The Sudanese Pound is the currency of the Republic of Sudan and is issued by the Central Bank of Sudan adopted when the country gained independence in 2011.
The country employs 80% of the labor force in agriculture, which also accounts for a third of GDP. However, since a large portion of this produce is subsistence farming, a large portion of the people continues to live in poverty.
Source: Legit.ng
[ad_2]
Source link
