As of August 2026, the role of the US dollar in Africa is under scrutiny as several countries explore ways to reduce reliance on the greenback. This trend is part of a broader global movement toward de-dollarization, driven by geopolitical tensions and economic sanctions.
In 2023, the African Continental Free Trade Area (AfCFTA) secretariat announced plans to promote intra-African trade settlements in local currencies, aiming to reduce the continent's dependence on the dollar. However, implementation remains limited, and the dollar still accounts for the vast majority of trade and debt transactions in Africa.
Recent developments include discussions among BRICS nations, which have expanded to include African members like Egypt and Ethiopia, about creating a new currency or increasing use of national currencies in trade. Yet, economists point out that the dollar's deep liquidity, stability, and network effects make it unlikely to be dethroned in the near term.
Central banks in Africa continue to hold significant dollar reserves, and most commodity exports, including oil and gold, are priced in dollars. The dollar's dominance is reinforced by its use in international finance and as a safe-haven asset.
While some African leaders advocate for greater monetary sovereignty, experts caution that abrupt de-dollarization could lead to financial instability. The path forward likely involves gradual diversification and strengthening of regional financial institutions.
