Nigeria, Malawi and Rwanda have Africa’s worst-performing currencies in 2024

Nigerian naira, Malawian kwacha and Rwandan franc have been named the worst-performing African currencies against the US dollar in 2024, according to a latest report, having faced an array of challenges, from persistent trade imbalances, dwindling foreign reserves, to political instability.
Some African nations strengthened their currencies, while others faced worsening exchange rates in 2024. The worst-performing currencies were Nigeria’s naira, Malawi’s kwacha and Rwandan franc, having faced significant depreciation at about 104%, 67% and 19% respectively. Last year, African currencies faced significant challenges, including trade, rising debt levels, imbalances, inflation, political instability, regional insecurity, and dwindling foreign reserves, leading to varied performances against the US dollar. The greenback’s status as a reserve currency, its role in international trade, and the stability of the US economy makes it the most widely used benchmark for exchange rates worldwide.
A key factor in naira’s steep depreciation in 2023-2024 was the decision by the Central Bank of Nigeria’s (CBN) to liberalize the foreign exchange market in June 2023. Rwanda, but also Congo and other African countries, saw double-digit declines, reflecting economic pressures. Moderate depreciations ranging from 5.63% to 10.68% occurred in Angola, Sierra Leone, Madagascar, and Burundi, while Liberia’s dollar and Tanzania’s shilling appreciated slightly, showing resilience in their exchange rate performance. Comoros, Uganda, and Guinea recorded smaller declines under 5%, suggesting relative stability. These exchange rate fluctuations underscore the critical role played by robust fiscal and monetary policies to stabilize currencies, mitigate this volatility, and promote economic resilience across the continent.