There is a global de-dollarisation campaign which is already gaining momentum as countries around the world are seeking alternatives to the hegemony of the US dollar, with China and Russia now trading in their own currencies, while Beijing and Brazil have also dropped the US dollar in bilateral trade.
Kenyan President, William Ruto, has joined China, Russia, Brazil, India, ASEAN nations, Saudi Arabia, and the UAE in the strong call for de-dollarisation of the United States’ dollar as he called on African countries to adopt local currency for intra-African trade.
There is a global de-dollarisation campaign which is already gaining momentum as countries around the world are seeking alternatives to the hegemony of the US dollar, with China and Russia now trading in their own currencies, while Beijing and Brazil have also dropped the US dollar in bilateral trade.
Also, the United Arab Emirate (UAE) is selling China its gas in yuan through a French company, while Southeast Asian nations in ASEAN are de-dollarising their trade, promoting local payment systems, Geopolitical Economy reports.
Taking a queue in the de-dollarisation campaign, President Ruto during his address at the Djibouti parliament on Tuesday emphasised on the need for African countries to abandon dependence on the US dollar for trade transactions.
Ruto said, “From Djibouti selling to Kenya or traders from Kenya selling to Djibouti, we have to look for US dollars,” questioning “How is US dollars part of the trade between Djibouti and Kenya? Why?”
According to the Kenyan President, 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).
Ruto clarified that the intention is not to oppose the US dollar, but rather to ease trade on the continent, suggesting 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.
He said “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.
“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.”