Ghana’s Vice President Says Africa Must Embrace Digital Currencies

Divya  |  Jul 29, 2021

Ghana’s vice president Mahamudu Bawumia has called upon other African countries to show support for digital currencies. In an opening address at the Fifth Ghana International Trade and Finance Conference (GITFiC), Bawumia highlighted the role e-currencies could play in facilitating trade and enhancing economies on the African continent.

Ghana’s Vice President Makes a Case for Digital Currencies 

According to Ghana News Agency (GNA), vice president Bawumia said that Africa was in need of a “Single Central Payment” system for seamless cross-border transactions. He asserted that such an innovation could provide an alternative to existing high-cost mechanisms. 

Bawumia also pointed to the financial crisis sparked by the pandemic and suggested a digital payments system is indispensable in the current environment.

“When the scourge of the COVID-19 pandemic hit and forced many economies into partial and total lockdowns, it reinforced the need to pursue digitization,” he said.
The vice president underscored that digitization is a key concern for the Ghanaian government and discussed the country’s recent initiatives in the mobile banking sector. He said that these services demonstrated that “more people can be financially included, and this needs to be rolled out across Africa to ensure the growth of the AfCFTA vision.”

While expressing his hopes for a unified system, he stated:

“The rollout of the Pan – African system will synchronize successfully with the payment systems architecture developed by Central Banks across Africa and bring about a reduction in cost, time variability, and decreased liquidity requirements of commercial banks and central banks settlements.”

CBDC Testing in Ghana and Other Digital Currency Endeavors

Earlier this month it was reported that Ghana might test its CBDC in another two months. Maxwell Opoku-Afari, the deputy governor of the country’s central bank told a local media outlet that a pilot for digital cedi is “expected to start by September.” Vice president Bawumia also alluded to the project and stated that it would bring greater credibility to Ghana in the digital sphere.

Like Ghana, Nigeria is also in the process of implementing its own CBDC. The country has maintained a guarded stance against private cryptocurrencies but has shown enthusiasm for a potential state-backed asset. It is also gearing up to launch a pilot -- called GIANT -- in October this year.

Meanwhile, Morocco, Egypt, Kenya, and South Africa are also exploring the technology and its potential. Some of these countries are still in the research stage, while others are already experimenting with transactions.

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