Rising Sino-African trade and infrastructure cooperation is fueling demand for the Chinese yuan in Africa, experts said Thursday in Nairobi, the capital of Kenya.
NAIROBI, Sept. 27 (Xinhua) -- Rising Sino-African trade and infrastructure cooperation is fueling demand for the Chinese yuan in Africa, experts said Thursday in Nairobi, the capital of Kenya.
African governments and traders are increasingly turning to the Chinese yuan, or renminbi, to settle financial transactions with China, bypassing the U.S. dollar to save on costs, said Victor Murinde, executive director of the African Economic Research Consortium, a not-for-profit organization.
"There is growing demand for the Chinese yuan in Africa to avoid foreign exchange losses and transaction costs in Sino-African trade," Murinde said on the sidelines of the Kenya Bankers Association's 13th Annual Banking Research Conference, which began on Thursday.
The two-day conference brought together over 100 delegates, including senior government officials, banking leaders, researchers and policymakers, to discuss critical issues shaping Kenya's banking sector.
According to China's customs data, Sino-African trade reached 282.1 billion U.S. dollars in 2023, cementing China's position as Africa's largest trading partner.
Murinde said rising trade between Africa and China is also increasing the use of the yuan among African central banks, which are adding it to their reserve currency baskets.
Raimond Molenje, acting chief executive officer of the Kenya Bankers Association, said the expansion of Sino-African trade allows African countries to receive yuan for their exports to China, which can then be used to pay for imports from the Asian nation.
The significant presence of Chinese firms undertaking infrastructure projects across Africa has further prompted African nations to hold yuan as part of their foreign exchange reserves, Molenje added. ■