Decades after independence, currencies from at least 40 African countries are still printed in Britain, France and Germany. Rich African countries are also on the list. Isn't that a threat to Africa?
The problem was that the Gambia did not print its own currency, but had ordered the UK to make up for the shortfall in the country's liquid currency, and that order was still delayed.
This issue of shortage of banknotes in this country highlights an interesting aspect of the country's economy. The Gambia is an independent country but depends on another country for its currency production. Currency is a symbolic element of any nation's identity.
However, the Gambia is not alone. More than two-thirds of the 54 countries in Africa currently print their notes abroad, mainly in European and North American countries.
The British currency printing company De La Rowe, Sweden's Crane AB and Germany's Gezike Plus Durant are among the top private companies that have contracts to print the national currencies of African countries.
It may come as a surprise to many that almost all African countries import their own currencies and for many this fact raises questions about national pride and national security.
Is printing a threat in another country?
Many African experts say that countries that are trying to print their own currencies could fall prey to corrupt officials or hackers who could change the currency. In the opinion of these experts, in many cases, outsourcing or printing money from foreign companies is safer.
But there are also many challenges in importing notes. Containers of Liberian dollars sent from Sweden disappeared in 2018, but the government was later blamed. Similarly, special ships are booked for transferring notes and it also costs a lot of money.
But even so, companies like De La Ro have been around for hundreds of years, printing large numbers of notes for central banks around the world. They have the tools and experience to innovate currency like polymers. Ghana, for example, is currently in talks with the German company Gezike Plus Durant to develop its central bank's digital currency (CBDC).
These firms additionally produce national passports and other identification documents and the security of these companies is very high so that they can be protected from hackers etc. In addition, their locations are not known where the notes are printed. The process of watermarks, pictures and other difficult engravings, which are common in banknotes, is extremely complex and expensive.
Also, as the world moves toward new cashless technologies, the cost of production is becoming more and more meaningless for many countries. Declining demand for new banknotes also forced Denmark to go outsourcing in 2014, and the European country now hides notes in another country.
But there are also disadvantages to printing notes in another country. Some governments may use it as a weapon to impose sanctions on other countries. For example, after the United Nations imposed sanctions on former Libyan ruler Muammar Gaddafi, Britain banned de la Rowe from printing Libyan dinars.
Many African countries are also working on a plan to print the currencies of African countries on the same continent, but African countries have little faith in each other in this regard. These countries have increased their reliance on companies based abroad.
Also read : The $ became more expensive on the interbank market
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