The recent growth of the global forex market has much to do with increased accessibility, particularly in developing economies such as Africa.
Here, the combination of rising Internet penetration rates and accessible forex accounts complete with a lucrative welcome bonus have empowered a new generation of forex traders, with some brokers recording increased participation rates in excess of 100% throughout 2020.
But what are the five strongest and most valuable currencies in Africa? Here’s our list based on 2020’s data!
1. The Libyan Dinar
We start with an asset that has been Africa’s strongest and most robust currency for years, thanks in part to a stringently controlled supply that sells only a limited number of dollars to its citizens.
What’s more, the Libyan Dinar (LD) has been pegged to the value of the USD dollar (USD) since 1973, creating a relatively stable exchange rate that typically varies between 1.41 and 1.43.
The current rate sees a single USD worth 4.5 Libyan dinar, which has enabled the currency temporarily to retain much of its value throughout the trials and tribulations caused by the political unrest and coronavirus pandemic.
2. The Tunisian Dinar
Historically, Tunisia was run as a colony of France, so it utilised the French franc for many years prior to 1960.
Since then, however, the Tunisian dinar (DT) has become the national currency of Tunisia, with this asset continuing to benefit from a monetary policy that makes it illegal to export or import dinars and convert them into other currencies.
Currently, a single USD is worth DT 2.87, so the asset definitely remains one of the strongest of its type in Africa.
3. The Ghanaian Cedi
Prior to 2007, Ghana’s national currency was subject to incredible volatility and ongoing uncertainty.
However, this changed when the Bank of Ghana replaced the Cedi 14 years ago, with this part of a wider economic reform that brought jobs and prosperity to the region.
What’s more, the value of the Cedi is fundamentally increased by Ghana’s GDP per capita, which is currently the largest in West Africa. At the current rate of exchange, a single USD will buy you 5.75 Cedi.
4. The Moroccan Dirham
Throughout the Western Sahara region, the Moroccan Dirham has been the primary and de-facto medium of exchange for years now.
This automatically makes the MAD one of the strongest and most widely used currencies throughout Africa, with one US dollar currently able to secure you 9.89 in Moroccan dirhams.
5. Botswana Pula
Currently, a single USD dollar is worth 10.90 Botswana Pula (P), with the recent growth of this currency having established it as one of the largest assets of its type in Africa.
In fact, it has become increasingly valuable as the Botswana economy has become more robust and stable during the last decade, while its presence on the Johannesburg Stock Exchange also makes it highly popular and attractive amongst investors.
Prior to 1976, the Pula’s exchange rate and valuation were calculated on the same basis as the rand, but this has changed as part of wider economic reforms in the region.