Countries on the African continent have economies and currencies that are performing at different levels. Some countries have currencies that are strong enough to compete with the US dollar, while others have severely weak currencies. Several factors influence the strength of a country's currency and these factors include economic policy, GDP per capita, and the inflation rate.
It's worth noting that the strongest currencies in Africa aren't necessarily the ones that everyone is familiar with. For example, the Nigerian Naira, one of Africa's most popular currencies, is one of the continent's weakest currencies. In this article, we discuss the top ten most valuable currencies in Africa in 2022.
1. The Tunisian Dinar (TND)
The Tunisian dinar is Africa's strongest currency and one of the world's best-performing currencies. It is the most stable currency in terms of foreign inflation rates and has low volatility when compared to other currencies. 1 dollar is equivalent to 3.01 TND in the current market. The Tunisian dinar is strong as a result of the country's cautious economic and budgetary planning, which has resulted in the currency's continued growth.
2. Libyan Dinar (LYD)
The Libyan dinar is Africa's second most valuable currency, with one US dollar worth 4.70 LYD. The Libyan dinar has been considered one of the strongest currencies in Africa for some time, thanks to the Central Bank of Libya's rigorous monetary policies. Libya is Africa's fourth-largest country, with the world's tenth-largest proven oil reserve, and the Dina’s value increased dramatically as a result of the oil sales.
3. Ghanaian Cedi (GHC)
Thanks to the country's strong GDP per capita and the Central Bank of Ghana's monetary policy program, the Ghanaian Cedi is the third most valuable currency in Africa. In the current market, 1 US dollar is equivalent to 7.30 GHS. The Cedi was adopted in 1965 to replace the Ghanaian pound and is now a cost-effective alternative to other major currencies in Africa.
4. Morocco Dirham (MAD)
Morocco's dirham is the continent's fourth-most valuable currency and the current exchange rate of the dirham against the US dollar is 1 USD = MAD 9.84. The country's inflation rate is relatively low, which helps the dirham's strength and stability. Morocco's government is also extensively invested in the mining business, and the country boasts one of the world's greatest phosphate reserves.
5. Botswana Pula (BWP)
The Botswana Pula is one of Africa's most stable currencies, ranking fifth on our list of least volatile currencies against foreign inflation rates. In today's market, one dollar is worth 11.62 BWP. The currency's high ranking can be ascribed to the country's relatively stable democracy and effective economic policy.
6. Eritrean Nakfa (ERN)
The Eritrean nakfa is the sixth most valuable currency in Africa in 2022. In the current market, one US dollar equals ERN 15.00. One of the factors contributing to its strength is that the currency is not floated by the government. The Nakfa is also one of Africa's most liquid financial assets, as it can be used for international payments anywhere on the globe.
7. Seychelles Rupee (SCR)
The Seychellois rupee is Africa's seventh most valuable currency, with a current exchange rate of SCR 15.00 to 1 US dollar. Seychelles is Africa's smallest country, yet it has a robust economic policy that contributes significantly to the strength of the Seychellois Rupee. The Seychelles has the highest nominal per capita GDP of any African country, with processed fish and non-fillet frozen fish as key exports.
8. The South African Rand (ZAR)
The South African rand is placed eighth on our list, with 1 US dollar equaling 15.60 ZAR. The rand is highly appreciated because of the country's excellent economic policies, low inflation, gold exports, and high GDP per capita. Over time, South Africa produces the most gold in Africa, and the price of gold has influenced the value of the rand over time.
9. Zambian Kwacha (ZMK)
The Zambian kwacha, introduced in 1968, is Africa's ninth most valuable currency, and 1 US dollar is currently worth ZMK 16.94. The Zambian Kwacha's strength is due to the country's excellent economic policy, which includes a high GDP per capita and a low inflation rate.
10. Egyptian Pound (EGP)
The Egyptian pound is the tenth most valuable currency in Africa in 2022 and EGP 18.59 is the equivalent of 1 US dollar. The Egyptian pound's strength is influenced by the country's high nominal GDP per capita and the government's interest rate cuts to attract local and foreign investment.