What particularly notable this week was a significant shift happening in Africa-China trade. Ecobank, the pan-African banking giant, is actively negotiating with Bank of China to establish a direct local currency-to-yuan settlement system by the end of 2026.
This move could fundamentally change how African businesses pay their Chinese suppliers. Currently, traders must convert their local currencies into US dollars first, then into yuan - a costly two-step process that eats into profit margins through banking fees.
"We are looking at opportunities for us to settle with, instead of going through the dollar, we do it directly with the Chinese yuan," Ecobank Chief Executive Jeremy Awori told Reuters on Monday, April 21. "You need the right tools and payment mechanisms to be able to do that. We are investing in those."
Numbers That Tell the Story
The timing makes perfect sense when you look at the trade volumes. Chinese exports to Africa jumped 26 percent to $225 billion in 2025, pushing total China-Africa trade to a record $348 billion.
It is notable that Ecobank already laid the groundwork for this initiative. The bank signed a memorandum of understanding with Bank of China's Mauritius unit in December 2025 to expand trade finance, payments, and renminbi capabilities across its 35 African markets.
The Domino Effect
Ecobank is not pioneering this alone. South Africa's Standard Bank received authorization in November to offer transactions through China's Cross-Border Interbank Payment System (CIPS), making the yuan the underlying settlement currency for its clients.
Afreximbank has also joined CIPS, which is processing rapidly growing volumes of Africa-China transactions. This coordination suggests we are witnessing a coordinated shift away from dollar dependency in African financial systems.
Beyond Currency Settlements
Ecobank is simultaneously strengthening its infrastructure. The bank is making major investments this year in ATM networks, data centers, and digital lending platforms. They have partnered with Google to upgrade payment systems.
Financial performance is supporting these ambitions. Ecobank resumed dividend payments for the first time since 2022, following stronger revenue and profit growth in 2025. Their corporate and investment banking unit posted a 40 percent rise in pretax profit, boosted by sovereign debt restructuring mandates in Gabon and Benin.
The bank also secured a financing deal in Uganda worth more than 200 million euros with South Africa's Development Bank of Southern Africa (DBSA).
Reality Check
Despite the optimism, challenges remain. Experts warn that regulatory alignment, liquidity management, and currency convertibility will determine whether direct yuan settlements succeed at scale.
Awori acknowledged these uncertainties, noting that no final agreement has been reached with Bank of China. He said global macroeconomic uncertainty makes the outlook difficult to predict, which strikes me as refreshingly honest for a banking executive.
What I find most compelling about this development is its potential to reshape African trade relationships. If successful, this system could reduce transaction costs and give African businesses more flexibility in global markets, particularly as China-Africa economic ties continue deepening.