Digital currencies are primed to reinvent trade between African countries.
Ghana's vice president Dr. Mahamudu Bawumia believes that African governments need to embrace digital currencies to facilitate trade throughout the continent.
As reported by Ghanaweb Bawumia outlined his argument during the Fifth Ghana International Trade and Finance Conference, which boasted the theme of “Facilitating Trade and Trade-Finance in AfCFTA; The Role of the Financial Services Sector.” He argued that trade between African countries demands a “single central payment” system. Currently, moving goods over African borders is costly and time-consuming. A digital payments system, Dr. Bawumia believes, would rectify these issues.
“Digitization has also become one of the most consequential policies of the Nana Akufo-Addo government,” said Dr. Bawumia.
“When the scourge of the COVID-19 pandemic hit and forced many economies into partial and total lockdowns, it reinforced the need to pursue digitization.”
The Vice President also discussed Ghana’s recent payment initiatives, such as Mobile Money Interoperability. Dr. Bawumia notes these services have “shown that more people can be financially included, and this needs to be rolled out across Africa to ensure the growth of the AfCFTA vision.”
Earlier this year, The Bank of Ghana (BoG) revealed it has a central bank digital currency (CBDC) in development. Dr. Bawumia noted the bank’s intent and believes it will bring the country credibility in the digital space.
African countries have long been exploring crypto and other forms of digital currency. Nigeria is planning its own CBDC called GIANT, set to launch this October, even after its central bank banned financial institutions from working with crypto exchanges. Tanzania, which banned cryptocurrencies back in 2019, has plans to reverse its course and implement crypto-positive regulation after its President, Samia Suluhu Hassan, spoke favorably of Bitcoin.