- Manufacturers Warn Currency Swings Could Blunt Africa’s Single-Market Ambitions
Ghanaian manufacturers are pressing the African Continental Free Trade Area Secretariat to revive the continent’s long-running ambition for a common currency, arguing that persistent exchange-rate volatility is eroding some of the commercial benefits expected from deeper African trade integration.
The call from the Association of Ghana Industries reflects growing concern that removing tariffs and other border barriers may not be enough if companies still face costly and unpredictable currency conversion when trading across African markets.
For manufacturers, the issue has become particularly acute as movements in exchange rates complicate procurement, pricing and long-term investment decisions.
Dr Paa Kwesi Eduaful Abaidoo, an AGI representative and Sustainability Manager at Mini Plast Ltd, said the core problem is that businesses can agree transactions at one exchange rate only for the value to move materially before settlement.
“Today, you know you are benchmarking your import or trade with an exchange rate but by the time the goods comes for payment, the rate is somewhere else,” he said.
For manufacturers, that uncertainty can alter the cost of raw materials, machinery and intermediate goods while making export pricing more difficult.
Dr Abaidoo therefore urged the AfCFTA Secretariat to take a more active role in advancing monetary integration.
“Is it time for the AfCFTA Secretariat Africa to push the agenda of having a common currency. Indeed, what we wish to have beyond the platform that the banks are providing is for us to have a common currency,” he said.
His intervention reopens a long-standing question at the heart of Africa’s integration project: whether a single market can function efficiently while member states continue to operate under dozens of separate currencies and monetary-policy regimes.
In principle, a common currency could remove exchange-rate risk among participating countries, reduce transaction costs and make cross-border pricing more predictable. It could also make it easier for manufacturers to build regional supply chains without constantly recalculating procurement and sales decisions against shifting bilateral exchange rates.
For smaller firms in particular, that predictability could lower one of the barriers to entering new African markets.
But monetary union would require a much deeper level of integration than tariff liberalisation. Participating countries would have to surrender substantial control over monetary and exchange-rate policy while agreeing common rules around inflation, fiscal discipline, reserves and financial stability.
With African economies operating at very different levels of debt, inflation and external-balance resilience, a policy appropriate for one economy may be poorly suited to another.
The AfCFTA Secretariat has itself treated a continental single currency as a longer-term objective rather than an immediate policy step.
In July, Secretary-General Wamkele Mene said implementation of existing trade rules remained the priority while acknowledging the much greater complexity involved in creating a shared currency.
That places more practical emphasis in the near term on payment infrastructure that can reduce currency friction without requiring countries to abandon national currencies.
The Pan-African Payment and Settlement System is currently the most important mechanism attempting to bridge that gap.
PAPSS allows cross-border transactions to be settled using African currencies and is designed to reduce dependence on the US dollar and other external currencies for intra-African trade.
Mr Musah Abdallah, Head of Corporate and Investment Banking at Stanbic Bank Ghana, said the system had moved beyond concept and that the priority now was to scale participation.
“The most important thing us that is has started and starting alone is a big achievement,” Mr Abdallah said, adding that banks connected to PAPSS were working to expand participation across AfCFTA markets.
He said governments must continue removing trade barriers while banks improve connectivity and payment infrastructure between countries. The goal is to make cross-border settlement easier even before Africa reaches the much more ambitious stage of monetary union.
For Ghanaian companies, that distinction matters. PAPSS can potentially reduce conversion costs and shorten settlement times without requiring governments to surrender monetary sovereignty, making it a more immediately achievable solution to part of the problem manufacturers are highlighting.
The Bank of Ghana has also argued that fragmented payment and settlement systems remain a major obstacle to deeper African economic integration.
The debate also comes as Ghana seeks to help more local businesses enter African markets under AfCFTA. The 2026 Budget provides for support to at least 200 micro, small and medium-sized enterprises to access new markets while improving compliance with the agreement’s Rules of Origin.
That effort will depend not only on tariff access but also on whether businesses can manage logistics, standards, finance and currency risk effectively.
The commercial opportunity is significant. Intra-African trade exceeded US$220bn in 2024, according to figures cited from the AfCFTA Secretariat, but the existence of a continental market does not automatically ensure that companies can compete effectively within it. Transport costs, customs procedures, access to credit, product standards, infrastructure and payment systems all remain important constraints.
Currency volatility adds another layer to those risks. A Ghanaian manufacturer selling into Nigeria, Côte d’Ivoire or another African market may face a change in the value of payment between the time a contract is agreed and the time settlement occurs.
Smaller firms, which are generally less able to access hedging instruments, may respond by raising prices, absorbing losses or avoiding markets they would otherwise find commercially attractive.
The AGI proposal therefore raises a broader question about the sequencing of African integration. Trade integration is advancing through tariff reductions and common rules, but monetary and financial integration remains considerably less developed.
If those systems fail to keep pace, businesses may find that the theoretical advantages of a continental market are weakened by the cost and uncertainty of moving money across it.
For now, the more practical route lies in strengthening PAPSS, improving bank interoperability, reducing non-tariff barriers and building greater macroeconomic convergence among African states.
A true common currency would require a far more ambitious political and institutional settlement than the continent currently has in place.
But AGI’s intervention ensures that the issue will remain part of the industrial debate as businesses ask whether Africa’s financial architecture is evolving quickly enough to support the scale of trade AfCFTA is meant to create.
