The Rwandan franc has started to gain strength against the Ugandan shilling at Katuna, a month and a half after the reopening of the Uganda-Rwanda border.
The Rwandan currency has gained by at least 10% in the last few days since the borders were fully opened. Rwanda started a phased reopening of its border on January 31. Rwanda President, Paul Kagame had closed the borders effective February 27, 2019, after accusing Uganda of hosting Rwandan dissidents, abducting Rwandan nationals, and locking them in non-designated areas.
Rwanda then issued a travel advisory to its nationals against travelling to Uganda, saying their safety was not guaranteed. The border closure suffocated business including the exchange of money. Now, days after the border re-opening, money changers have started to foresee their business boom again after the Rwandan franc started gaining strength.
Robert Katureebe, one of the prominent money changers at Katuna border says that so far, 1,000 francs trade at as high as Shs 3,350 buying and Shs 3,700 selling.
The Rwandan franc is gaining against the Uganda shillings even as the latter has been gaining steadily against other currencies like the US dollar and the Kenya shilling over the months. A currency losing exchange value is not necessarily bad, as it boosts the country's export volumes.
Katurebe says that when the border closed, the exchange rates declined to Shs 3,000 buying and Shs 3,300 selling per 1,000 Rwandan francs.
Katureebe says that the gain is a result of an increase in the number of Rwandans heading home from Uganda and Kenya which has created a high demand for Rwandan francs at Katuna.
Franko Korinako, chairman of Katuna Traders’ Association says that business at Katuna is slowly being revived. He prays that the impasse never returns again because it put them into huge losses. He says that as long as the border remains open, more people will cross and the money-changing business will boom like how it used to be. - URN/The Observer