KAMPALA Uganda (Xinhua) --
Uganda’s central bank said Tuesday that it has
stopped exchange of the Kenyan currency after Kenya decided to
suspend currency conversion and repatriation of the Kenyan
The Bank of Uganda said in a statement that
the Central Bank of Kenya informed it that it has issued a new
series of Kenyan banknotes with a view to combating illicit
flows and counterfeits into Kenya.
"In light of the new developments, the Bank of Uganda will
not accept the Kenya shillings at its counters with immediate
effect," the statement said.
The Bank of Uganda said changing the Kenyan currency from old
to new banknotes can only be done in Kenya.
Kenya’s withdrawal of old
banknotes disturbs cross-border trade
BUSIA (Xinhua) --
Kenya’s decision to withdraw the old generation
1,000 currency notes from circulation by October 1 this year is
hampering trade along the border with Uganda.
The Central Bank of Kenya (CBK) on June 1 announced that the
replacement of the old 1000 currency notes with a new one that
has additional security features, while the smaller
denominations will be phased out over the next three years.
At the border towns of Malaba, Suam, Busia and Lwakhaka in
western Kenya, the old 1,000 shillings notes are highly valued
However, the reported decision by Uganda’s central bank to
stop changing Kenyan currency has placed new hurdles to
cross-border trade in agricultural commodities and even
At the border points, traders now prefer to be paid via
mobile money as demand for Ugandan currencies surges.
Disgruntled traders explained the frustration they have been
suffered since the announcements.
The Kenya National Chamber of Commerce and Industry (KNCCI)
termed the situation in Uganda as fluid.
"The consequences of Kenya’s currency change are going to be
felt right from the border towns of Busia, Malaba and Kampala
because millions are still held by that country’s businesses,"
said Peter Kubebea, chairman of KNCCI’s Busia chapter.
John Akiki, who operates a fashion shop at Malaba town, said
the Ugandan businessmen prefer transacting in shillings,
particularly the 1,000 notes and U.S. dollars.
"It is worrying that the withdrawal of the Kenyan notes
affect their business," said Akiki.
The situation is same at Kenya and South Sudan border towns.
Kenya shilling is the most preferred over the Sudanese pound at
the exit and entry points of the two countries.
Traders at Lokichoggio town shared similar predicament as the
deadline to end the use of 1,000 notes is coming closer. They
said the decision will hurt business at the border.
"It is disturbing that our government decided to give a short
period in withdrawing the notes from circulation.
"The action is going to affect business at the border and
this will have a negative impact on the economy," said Pius
Ewoton, chief executive officer of KNCCI’s Turkana chapter.
Ewoton said that the Kenyan government should have alerted
traders about the phasing out of old 1,000 currency notes
earlier in advance.