According to Vice President Dr. Mahamudu Bawumia, African economies need digital currencies supported by central banks in order to give transactions legitimacy.
Dr. Bawumia told attendees at the opening of the International Trade and Finance Conference (GITFiC 2021) in Accra on Tuesday that with the advent of digitalization, the emergence of digital currencies on the African continent is inevitable.
He was quick to point out, however, that what African countries need are central bank-backed digital currencies, not cryptocurrencies.
In response to a question about the continent’s readiness for an African digital currency, particularly in light of the presence of the AfCFTA, Dr. Bawumia emphasized the imminent adoption of digital currencies but added that such moves should be backed by African Central Banks, just as the Bank of Ghana has initiated a pilot digital currency.
“Digitization and the advent of digital currencies is something that is definitely coming. We are facing it and I am very, very happy that the central bank of Ghana is beginning a pilot digital currency and I think it will ultimately be the way to go for Africa. That we will adopt, or we should end up trying to adopt a digital currency,” Dr. Bawumia said.
“But I think that a digital currency that is backed by the central banks; that gives a lot of credibility to transactions and I think this is where we should be headed and the Bank of Ghana is leading the way. I expect other central banks to come forward with this in the future. It is the way to go.”
Senior officials from African central banks, the African Union, the West African Monetary Institute, members of the Diplomatic Corps, and other important players in the African Continental Free Trade Area (AfCFTA) attended the meeting both physically and virtually.
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