Nigeria swap deal shows renminbi’s African rise

Nigeria’s signing of a new currency swap deal with China will boost financial stability and promote broader African-Chinese economic cooperation, according to analysts. Nigeria is the third African country to sign a swap deal with China, after Egypt and South Africa.

“By reducing the dollar component of trade settlements between Nigeria and China, the cost of doing business between the two countries will fall and the naira should strengthen,” says Linus Iwuajoku, head of enterprise intelligence at Diamond Bank, a Nigerian commercial bank. “Trade flows between Nigeria and China will also increase, sending a positive message to traders and investors looking to do business in Nigeria.”

Under the terms of the swap signed in May this year, the central banks will exchange N720…

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