‘Why US dollars?’ — Kenyan president urges adoption of local currencies for intra-African trade

Kenyan President William Ruto has called on African countries to shift away from using the US dollar for intra-African trade.

During his address at the Djibouti parliament on Tuesday, Ruto spoke on the need to abandon dependence on the US dollar for trade transactions between African nations.

“From Djibouti selling to Kenya or traders from Kenya selling to Djibouti, we have to look for US dollars. How is US dollars part of the trade between Djibouti and Kenya? Why?” Ruto asked.

Ruto said the African Export–Import Bank (Afreximbank) has provided a mechanism that enables traders within the continent to engage in trade using their respective local currencies — the pan-African payment and settlement system (PAPSS).

The president clarified that the intention is not to oppose the US dollar, but rather to ease trade on the continent.

He suggested that purchases made from the United States can still be settled in US dollars, while transactions with Djibouti and other African nations can be conducted using local currencies.

“That is why Kenya champions the Pan African Payment and Settlement System that is done by our own institution — the Afreximbank. Why, members? Why is it necessary for us to buy things from Djibouti and pay in dollars? There is no reason,” he said.

“We are not against the US dollar. We just want to trade more freely. Let us pay in US dollars what we are buying from the US. But what we are buying from Djibouti, let’s use local currency.”

(Cable)