Eswatini recently became the latest African country to jump on the central bank digital currency (CBDC) bandwagon after its central bank selected Giesecke Devrient, a Germany-based technology firm, as its partner. An agreement signed by both parties aims to enable them to deepen their “understanding of the practicalities of implementing a CBDC in Eswatini.”
Retail CBDC Presents Strongest Opportunity for Adoption
The Southern African nation of Eswatini (formerly Swaziland) recently became the latest African country to signal its intention to issue a digital currency, after it was revealed that the Central Bank of Eswatini (CBE) has appointed a Germany-based firm called Giesecke Devrient as its technology partner.
According to a statement issued by the technology firm, an agreement to this effect was signed at the recent annual meeting of the International Monetary Fund (IMF) and the World Bank Group.
The country’s selection of the German firm comes some two years after the latter’s completion of the so-called CBDC Diagnostic Study which found that “a retail CBDC presented the strongest and direct opportunity for the adoption of a digital currency in Eswatini.” The recently signed agreement is said to enable both parties to further deepen their “understanding of the practicalities of implementing a CBDC in Eswatini.”
Ensuring Eswatini Is Fully Equipped to Issue a CBDC
Commenting on the CBE’s coming together with Giesecke Devrient, the bank’s governor, Phil Mnisi, said:
The Central Bank of Eswatini is delighted to have engaged G+D as a technical consultant to walk with us in our journey as we explore and formulate the foundational policy considerations and use cases of a localized CBDC. We are confident that G+D’s technological expertise and their strong regional presence in our continent will allow us to realize all possible advantages of a Digital Lilangeni and ensure we’re fully equipped to issue a CBDC in the future.
For his part, Wolfram Seidemann, the CEO of the technology company, suggested that Eswatini was one of the countries on the African continent to “take the step towards a retail CBDC.” Seidemann, whose firm has also partnered with the Ghanaian central bank, said his company was honored to be a part of Eswatini’s CBDC journey.
Like its counterparts in some African countries, the CBE is keen on rolling out a CBDC because it wants to overcome problems associated with fiat currency systems. While several African countries that are keen on launching a CBDC are either studying or conducting trials, the Nigerian central bank is the only institution in Africa to have launched a digital currency.