A shortage of hard cash and a severe drought that has caused power outages in copper-producing Zambia have made its currency, the kwacha, fall to a record low against the US dollar as of Wednesday, reaching 27.30 to the dollar.

Based on LSEG data, the value of the kwacha relative to the US dollar has decreased by over 5% this year and 17% in the last six months. The previous low, on February 6, was 27.23.

The latest profile of the Kwacha is an anti-climax from an earlier position this year, in February, following consistent drastic monetary policy interventions by its central bank, Zambia’s currency became Africa’s best-performing currency against the US dollar.

This year, the US dollar index, which measures the value of the dollar relative to a basket of currencies, has increased by 4% to 105.58. However, the MSCI International Emerging Market Currency Index, which opens in a new tab, has only declined by 1%, indicating that the kwacha is not keeping up with the currencies of larger emerging nations.

The southern African country went into default in 2020 due to the COVID-19 pandemic. Its attempts to restructure its debt have been plagued by delays, but in March they made progress when the government and a group of bondholders agreed in principle.

“There is too much demand for dollars, mainly to meet imports of petroleum products and we have very scanty supply. It appears we are heading towards 30 per dollar,” a trader at a commercial bank in Zambia said.

Global monetary tightening cycle caused serious problems for African currencies in 2023. The official currency rates for the Nigerian naira, Kenyan shilling, and South African rand saw considerable swings in December 2023, with an average decline of 27% from 25% in November.

Shell Nigeria, a multinational oil company, claims that through the operations of Shell Petroleum Development Company of Nigeria Limited and Shell Nigeria Exploration and Production Company of Nigeria Limited, it exclusively paid $1.09 billion in corporate taxes and royalties to the Nigerian government in 2023.

According to the numbers released in the recently released 2023 Shell Briefing Notes, SNEPCo remitted $649 million, while the SPDC paid $442 million.

Similar payments made by the two firms in 2022 totalled $1.36 billion, according to a statement from Abimbola Essien-Nelson, the company’s manager of media relations.

“These payments are Shell exclusive and do not include those made by our partners,” said SPDC Managing Director and Country Chair, Shell Companies in Nigeria, Osagie Okunbor.

Okunbor explained, “Shell companies in Nigeria will continue to contribute to the country’s economic growth through the revenue we generate and the employment opportunities we create by supporting the development of local businesses.”

He continued by saying that Shell has been an investor in Nigeria for more than 60 years and that the Briefing Notes provide an update on the state of the companies’ operations in Nigeria for 2023, including SPDC, SNEPCo, Shell Nigeria Gas, and Daystar Power.

He claimed that the studies demonstrated how the businesses kept driving advancement, collaborating closely with communities and stakeholders to support socio-economic growth and offer more affordable, environmentally friendly energy options.

“It is important to emphasise that Shell is not leaving Nigeria and will remain a major partner of the country’s energy sector through its deep-water and integrated gas businesses. Our collective focus remains on delivery of safe operations and care for our people,” Okunbor maintained.