EXPOSED: Naira Named Worst Performing Currency in Africa – World Bank Report

The World Bank has revealed that the Nigerian naira is one of the worst-performing currencies in sub-Saharan Africa for 2024. In its latest regional economic report, Africa’s Pulse, the bank noted that the naira had depreciated by approximately 43% as of August this year.

The report highlighted that the naira’s ongoing decline is largely due to limited dollar inflows and slow foreign exchange disbursements by the Central Bank of Nigeria (CBN) to currency exchange operators. Additionally, the high demand for U.S. dollars from financial institutions, money managers, and non-financial users has intensified the pressure on the naira, weakening its value.

“By August 2024, the Ethiopian birr, Nigerian naira, and South Sudanese pound were among the worst-performing currencies in the region,” the World Bank stated, citing the naira’s significant depreciation.

The report also emphasized that the weakening naira has contributed to rising domestic prices, particularly for imported goods, deepening the economic challenges for Nigerians. As of October 15, the naira traded at N1, 658 per dollar in the official market, according to FMDQ Exchange.

In contrast, currencies such as the Kenyan shilling and South African rand, which struggled in 2023, have seen improvement in 2024. The Kenyan shilling emerged as the strongest currency in the region, appreciating by 21% year-to-date by August, while the South African rand gained 3.1% after a difficult previous year.

Despite signs of recovery in some currencies, the World Bank cautioned that foreign exchange shortages and exchange rate pressures remain significant concerns across Africa.