Overview

Click to expand overview
BRICS member China is encouraging Africa to use local currencies like the Chinese Yuan and ditch the US dollar. Africa stands to gain in this situation as the Chinese Yuan is cheaper for China is boosting the use of its currency, the yuan, in Africa, to challenge the US dollar and to increase its economic and political influence on the continent. The US imports its debt around the world making other countries carry the risk of hoarding the currency. The rising US dollar is now a cause of concern for Africa as China is aggressively advocating for the Chinese yuan to replace the US dollar in trade between BRICS member countries and their global partners. Under the The ongoing de-dollarization campaign of BRICS (Brazil, Russia, India, China, and South Africa) sees an influx of African countries augmenting their reserves with BRICS, a group comprising the emerging economies of Brazil, Russia, India, China, and South Africa, is set to convene its 15th annual gathering – the BRICS 2025 Summit De-dollarisation bid begins to pay off as China and Africa increase use of the yuan and local currencies in trade deals. BRICS member China encourages Africa to use native currencies like the Yuan instead of the dollar for debt settlement. China’s major state-owned banks have taken

China Pushes Yuan in Africa: Reducing US Dollar Debt Repayment

The global financial landscape is shifting, and BRICS member China is encouraging Africa to use local currencies like the Chinese Yuan and ditch the US dollar. This move has significant implications for African economies and the dominance of the US dollar.

De-dollarisation in Africa: China's Yuan Initiative

The ongoing de-dollarization campaign of BRICS (Brazil, Russia, India, China, and South Africa) sees an influx of African countries augmenting their reserves with BRICS currencies. Africa stands to gain in this situation as the Chinese Yuan is cheaper. China is boosting the use of its currency, the yuan, in Africa, to challenge the US dollar and to increase its economic and political influence on the continent. This initiative aims to reshape trade dynamics and reduce reliance on the US dollar.

The US Dollar's Dominance Under Scrutiny

The rising US dollar is now a cause of concern for Africa. While the US dollar has long been the dominant currency in international trade and finance, concerns are growing about its impact on developing economies. The US imports its debt around the world making other countries carry the risk of hoarding the currency. The fluctuations and strength of the US dollar can create instability and increase debt burdens for countries heavily reliant on it.

China's Aggressive Push for the Yuan

China is aggressively advocating for the Chinese yuan to replace the US dollar in trade between BRICS member countries and their global partners. This strategy is gaining traction as more African nations explore the benefits of using the Yuan in trade and debt settlement. De-dollarisation bid begins to pay off as China and Africa increase use of the yuan and local currencies in trade deals.

Implications for African Economies

BRICS member China encourages Africa to use native currencies like the Yuan instead of the dollar for debt settlement. Using the Yuan and other local currencies can offer several advantages, including reduced exchange rate risks, lower transaction costs, and greater financial autonomy. China’s major state-owned banks have taken a proactive role in facilitating Yuan-denominated transactions in Africa, further promoting its adoption.

As BRICS, a group comprising the emerging economies of Brazil, Russia, India, China, and South Africa, is set to convene its 15th annual gathering – the BRICS 2025 Summit, the discussion surrounding de-dollarization and the role of the Yuan in global trade is expected to intensify.

Top Sources

Related Articles