Volatile US tariff policy is accelerating efforts across Africa to reduce reliance on the dollar in trade settlements, with companies increasingly exploring the use of China’s renminbi and local currencies, Ecobank Transnational Inc has said — a shift that could gradually reshape the continent’s trade and liquidity dynamics.
Jeremy Awori, CEO of the pan-African lender, told Bloomberg last week that despite the continent’s relatively modest trade exposure to the United States, the continent is not insulated from the ripple effects of policy swings from Washington.
Trade between Africa and the US rose to $83.4 billion in 2025 — the highest in at least six years and about 16 percent above the previous year, according to US Census Bureau data. However, the figure remains dwarfed by Africa’s roughly $315 billion trade flow with China, based on Ecobank economists’ estimates.
“We are going to see more options around direct renminbi conversion into African currency,” Awori said. “We also need to look at trading in African currencies, because if we can trade in our own local currencies, that takes off the pressure on the need for US dollars.”
What this means for Africa
The push away from the dollar reflects a broader strategic recalibration by African corporates and policymakers seeking to reduce exposure to currency volatility, tight global dollar liquidity and shifting US trade policies. Greater use of alternative settlement currencies could ease pressure on African foreign-exchange reserves, lower transaction costs and deepen regional financial integration over time.
It also aligns with ongoing efforts under the African Continental Free Trade Area (AfCFTA) to boost intra-African commerce and build more resilient regional supply chains.
Fresh uncertainty surrounding the African Growth and Opportunity Act (AGOA) — which grants duty- and quota-free access for eligible African exports into the US but is subject to periodic renewal — is adding urgency to diversification efforts, Awori noted.
According to UN Trade and Development, intra-African trade reached about $220 billion in 2024, representing roughly 15 percent of the continent’s total trade. While still modest, the figure underscores growing momentum toward regional commerce.
Ecobank noted that scaling intra-African trade will be a critical hedge against external geopolitical shocks. He pointed to Nigeria’s 650,000-barrel-per-day Dangote refinery as a potential catalyst for stronger regional energy trade, with the facility expected to supply gasoline, diesel and jet fuel across multiple African markets.
“We would really hope to see more value addition across all segments — whether mining, oil and gas, or agriculture — to push up intra-Africa trade going forward,” Awori said.
Still, structural bottlenecks remain. Non-tariff barriers, regulatory frictions and cross-border payment inefficiencies continue to constrain trade flows, suggesting that while momentum to reduce dollar dependence is building, execution risks remain in the near term.
