In a recent address to the Djibouti Parliament, President William Ruto of Kenya received resounding applause for his call to African countries to dump dollars and use local currencies for trade within the continent. This is not the first time Ruto has advocated for abandoning the dollar, as he made a similar appeal at the African Private Sector Dialogue on the African Continental Free Trade Area in Nairobi last month. Video clips of his call quickly spread across social media, showing that many felt Ruto had spoken their thoughts.
This bold stance has ignited a crucial conversation about the economic potential and benefits that such a move could bring to Africa. For starters, it brings to mind, the late Libyan leader, Muammar Gadhafi. Gadhafi staunchly advocated for African economic independence by consistently championing the idea of an African Development Bank and the establishment of a unified currency, army, and passport. He saw these as the basis for emancipating African nations from the shackles of Western dominance and creating a self-reliant continent.
Gadhafi, who was then Chairman of the African Union in 2009, conceived and was in the process of financing a plan to unify African states with one gold currency. Unfortunately, Gadhafi’s plans were frustrated by the West, which perceived them as a threat to their own interests. They right away imposed unjustified sanctions on Libya, armed dissidents to destabilize the country, and ultimately intervened to depose and murder Gadhafi in 2011.
The striking parallels between Gadhafi’s fate and Ruto’s current stance raise concerns about the potential repercussions faced by African leaders who challenge the existing global economic order. As Ruto continues to advocate for the use of local currencies in African trade, he risks becoming a target of covert and overt actions by Western powers seeking to protect their dollar hegemony. The experiences of Eritrea under the leadership of Isaias Afwerki, who has pursued a self-reliant economic path, serve as a reminder of the threats to such independent-minded leaders.
Nonetheless, the necessity of shifting away from the US dollar and promoting the use of local currencies in African trade cannot be overemphasized. This is the only way that African nations can gain greater control over their monetary policies, allowing them to tailor strategies to address specific economic challenges, such as managing inflation and encouraging investments. Moreover, conducting trade using local currencies would also enable African countries to foster closer economic ties, strengthen trade relationships, and promote collaboration among themselves, leading to the creation of larger and more resilient regional markets.
Moreover, by embracing local currencies, African countries would experience increased trade volumes and stronger economic cooperation within the continent. This would in turn pave the way for regional integration and sustainable economic growth. African leaders need to quickly work toward this common currency, as espoused by Ruto. We can’t have a lone voice advocating for it, while the rest keep silent.
It is imperative that African leaders, together with civil society, and policymakers heed the urgency of Ruto’s call and support the shift towards local currencies in intra-African trade. Africa must not shy away from its rightful place in the global economy. It has everything it requires to challenge the status quo, dismantle neocolonial structures, and embrace a future where African nations determine their own economic course as formidable players in the global arena.
