LETTERS: Currencies: Are we stuck with the dollar's dominance? Yes and no

As then US treasury secretary John Connally told his G-10 counterparts at their Rome meetings in late 1971, “the dollar is our currency, but it’s your problem!”
The US dollar is largely used as the reserve currency globally. / Net photo.
The US dollar is largely used as the reserve currency globally. / Net photo.

Editor,

RE: “Rwanda’s progress is the death knell of This Is Africa” (The New Times, September 1).

As then US treasury secretary John Connally told his G-10 counterparts at their Rome meetings in late 1971, “the dollar is our currency, but it’s your problem!”

It has grown exponentially as a problem for the rest of the global economy as its intrinsic value has become even more misaligned with the fundamentals of the economy on which it is based.

Basically, since the Nixon administration, the US has extended its taxing power to the entire global economy through its control of the world’s reserve currency and its manipulation to support its twin budgetary and current account deficits by exporting their costs to the rest of the world.

And, God help anyone who attempts to break their yoke on the greenback; gun-boat ‘diplomacy’ then comes into play since the continuation of this arrangement and the global dominance it gives to the US depends on preventing any erosion in the US dollar’s status as the world’s reserve currency.

Mwene Kalinda

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Dear Sunny Ntayombya, I like your critical thinking and genuine questioning. Why do we need dollars for intra-trade in regional blocs or inter-trade with other African nations? Why do African nations need USA dollars for trade with Asian countries?

The elephant in the room (the USA) designed the system in such a way that it exploits the rest of the world. It’s so serious that anyone trying to change the system becomes the next victim.

The late Libyan leader Col. Muammar Gaddafi once asked the same questions and because he was planning a solution, where is he now? Beware of the dangers/fate that await any great thinker not only on the African continent, but anywhere in the world, trying to alter the flow of resources northwards!

I, however, believe that if African Heads of State agreed and committed to introducing one African currency for the purpose of promoting trade on the continent, they would win this battle. It would accelerate quicker development of the African nations and close all the loopholes, leakages and exploitation Africa has suffered as a result of using the dollar as the reserve currency.

Paul Runesha

 

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