List of the Lowest Currencies in the World – Exchange rates or currency exchange rates are the value of a country’s currency exchanged for another country’s currency. But in general, the category of a currency is said to be strong or weak depending on its exchange rate with the US dollar. Since the end of World War II, the dollar or American currency has become one of the most important currencies in the world.
It can be said that the American currency is the most common currency around the world. This happens because the US dollar is one of the reserve currencies of the majority of countries in the world and is most widely used for transactions in international trade. The centrality of this currency has provided many benefits, especially for the ease of international trade. This includes loans from other countries.
Currency exchange rates are classified as fluctuating or up and down and are influenced by many economic factors. In fact, several factors have a strong influence on currency values, namely the level of demand for currency. In addition, investor interest in a country, inflation, and the country’s commodities also greatly affect the value of the currency.
List of the Lowest Currencies in the World
But do you know, Sinaumed’s, which countries have the lowest currency values in the world? Let’s see the full explanation below.
1. Venezuelan bolivar
Currently, the lowest currency in the world is still chosen by the Venezuelan Bolivar. Especially during the Covid-19 pandemic in early 2020, this currency immediately slumped significantly due to inflation. Thus, this currency is now listed as the lowest currency in the world. The Venezuelan bolivar is also considered the currency with the highest inflation worldwide. The Venezuelan Bolivar redenomy was established on August 20 2018. Where the main reason for this determination was due to hyperflation in the range of 830,000% which continues to increase every day.
Prior to redenomination, 1 Dollar was equal to minus 248,487 VEF. Then the old version of the banknote was replaced with a new form with the new 1 VES exchange rate equaling the old 100,000 VEF. Sinaumed’s needs to know that cryptocurrency was actually created by the government with the aim of fighting the United States dollar. However, this only accelerated the pace of hyperinflation because the government itself determined the dollar exchange rate as they pleased.
Currency code – VES (Old: VEF).
Venezuelan Bolívar exchange rate:
1 IDR = 280 VES (Indonesian Rupiah to Venezuelan Bolívar).
1 USD = 4,000,815 VES (US Dollar to Venezuelan Bolívar).
2. Iranian Rials
World’s second lowest currency is the Iranian Rial. The devaluation that occurred in 1979 after the Islamic Resolution, at which time many businesses were withdrawn from the country of Iran due to the uncertain situation. After that, the Iran-Iraq war emerged and was followed by economic sanctions because of the nuclear program in this country. The Iranian government also began to limit access to foreign currency circulating among its citizens.
This is because this is one of the triggers for a significant increase in the black market. The aftermath of all this has damaged the economy and reduced the value of the Iranian currency by almost 400%. Then in 2015, the Iranian government agreed to sign a nuclear agreement with the United States, Great Britain, France, Russia, Germany, and also China in order to obtain sanctions mitigation. This then helped in improving the condition and stability of the Iranian currency.
But in 2018 the United States revealed that Iran would continue with its nuclear program. As a result of this, sanctions are increasingly sharpened and access to world commodity markets is increasingly restricted. Therefore, Iran cannot export petroleum, which has contributed 69% of the country’s annual income. This is what creates a crisis deficit in the national budget.
Various sanctions have been imposed on other industries, including metallurgy and petrochemicals. After that, in 2020 yesterday, Iran faced moderate inflation which made its currency devalued by up to 600%. Because of this, the government decided to change the Rial currency to Toman and remove four zeros from the currency’s value. For example 10,000 old Rial becomes 1 Toman.
Currency code – IRR.
Iranian Rial exchange rate:
1 IDR = 2.94 IRR (Rupiah to Iranian Rial).
1 USD = ~278.800 IRR (US Dollar to Iranian Rial – black market exchange rate).
1 USD = 42.025 IRR (US Dollar to Iranian Rial – official exchange rate).
3. Vietnamese Dong
The Vietnamese Dong is the currency with the third lowest value in the world. The country is still going through the most difficult times from a centralized economy to a market economy. Therefore, the consequence is that the currency of Vietnam has decreased in value to this day. Until now, the Dong currency has been ranked third in the list of the lowest currencies in the world. However, experts say that the Vietnamese government is doing the right thing and may soon overtake its closest Asian neighbour.
Currency code – VND.
Vietnamese Dong exchange rate:
1 IDR = 1.59 VND (Indonesian Rupiah to Vietnamese Dong).
1 USD = 22.764 VND (US Dollar to Vietnamese Dong).
4. Indonesian Rupiah
As a result of the lower exchange rate of old banknotes, now based on a presidential decree on September 5 2016, there are 7 newly issued banknotes in denominations, ranging from a nominal value of 1000 to 100 thousand rupiah. The State of Indonesia is actually classified as a developing country in the Southeast Asia region which has a stable economy. However, the currency owned by Indonesia has a fairly low exchange rate. The regulatory authorities within Indonesia have taken all steps to strengthen their national currency. However, these efforts turned out to only lead to changes that were not too significant.
Currency code – IDR.
Indonesian Rupiah exchange rate:
1 USD = 14,253 IDR (US Dollar to Indonesian Rupiah).
5. Sum of Uzbekistan
The modern Sum has been entered into a circulation which has a ratio of 1 Sum equal to the value of 1000 Sum coupons as of July 1, 1994 according to Decree of the President of the State of Uzbekistan. This occurred as a result of the liberalization of monetary policy from September 5 2017. Where the Sum exchange rate against the US dollar is at a value of 1 USD equal to 8,100 UZS, with an estimate of 8,000 to 8,150 UZS for one US dollar.
Currency code – UZS.
Uzbekistan Sum exchange rate:
1 IDR = 0.74 UZS (Indonesian Rupiah to Uzbekistan Sum).
1 USD = 10.667 UZS (US Dollar to Uzbek Sum).
6. Leon Sierra Leone
Sierra Leone is one of the poorest countries in Africa. This country often experiences serious problems so that the local currency exchange rate becomes very weak. Even recently, the country experienced war and got cases of the Ebola virus again. Does Sinaumed’s know this country?
Currency code – SLL.
Sierra Leonean Leone exchange rate:
1 IDR = 0.73 SLL (Indonesian Rupiah to Sierra Leonean Leone).
1 USD = 10,430 SLL (US Dollar to Sierra Leonean Leone).
7. Guinean Franc
The existence of a fairly high inflation rate as well as increasing poverty rates and the high population of gangsters has further reduced the value of the Guinean currency. One of the countries in Africa is a country that has the most inflated currency. When compared with natural resources which are very abundant, for example, diamonds, gold, and also aluminum. The country’s currency should have a high exchange rate. But on the contrary, its natural wealth does not make this country a wealthy country.
Currency code – GNF.
Guinean Franc exchange rate:
1 IDR = 0.68 GNF (Indonesian Rupiah to Guinean Franc).
1 USD = 9.782 GNF (US Dollar to Guinean Franc).
8. Lao Kip
The country of Laos is one of the countries that actually does not have a low currency exchange rate. However, since the inception of the issuance of the currency, that value, the exchange rate has been very low. Not only that, since the issuance of the Lao currency in 1952, this currency has experienced strengthening against the US Dollar and its exchange rate continues to increase.
Currency code – LAK.
Lao Kip exchange rate:
1 IDR = 0.67 LAK (Indonesian Rupiah to Lao Kip).
1 USD = 9,574 LAK (US Dollar to Laotian Kip).
9. Guarani Paraguay
Paraguay is the second poorest country in South America. The country experienced a very drastic economic downturn. Then coupled with inflation, corruption, and also the very low quality of education. Not only that, the number of poor people is also high, coupled with the increasing unemployment rate, making this country even poorer. In fact, Paraguay became a sizeable exporter of cotton and soybeans. However, this cannot cover the high import costs. So the currency exchange rate is getting lower.
Currency code – PYG.
Paraguayan Guarani exchange rate:
1 IDR = 0.48 PYG (Indonesian Rupiah to Paraguayan Guarani).
1 USD = 6.914 PYG (US Dollar to Paraguayan Guarani).
10. Cambodian Riel
Cambodian Riel is one of the currencies of the monarchy in Southeast Asia, namely Cambodia. This monetary unit was issued in 1995 to serve as a substitute for the Indochinese Piastre. At first, the Riel had a fairly low exchange rate and was unpopular. So that local residents prefer to use foreign currency. Currently, many Cambodian people prefer to use US dollars as a means of payment. This certainly makes the Riel currency exchange rate decrease.
Currency code – KHR.
Cambodian Riel exchange rate:
1 IDR = 0.28 KHR (Indonesian Rupiah to Cambodian Riel).
1 USD = 4.077 KHR (US Dollar to Cambodian Riel).
List of Re-Denominated Currencies
Denomination is a change in the nominal value of paper money. Usually this occurs after inflation with the aim of stabilizing currency exchange rates and simplifying calculations. As long as the denomination occurs, the old version of banknotes will be replaced with the latest version according to the rules, where the unit value is smaller. Because of this one procedure, the list of currencies below can come out of the list of the lowest currencies in the world.
1. Dobra Sao Tomé
The denomination in this one currency was made on January 1 2018. Then the result is 1 new Dobra or STN, the value of which is the same as 1,000 Dobra or the old version of STD. There are two small islands in West Africa, namely St. Tome and Principe are two exporting regions for coffee, cocoa and coconut. However, this is not enough to support the local economy at an appropriate level. But recently an oil field has been discovered in the area of St. Tome. By doing so, it is hoped that the value of the Dobra currency will soon rise.
Currency code – STD.
Dobra Sao Tome exchange rate:
1 USD = 22,511 STD (US Dollar to Dobra Sao Tome – before denomination).
2. Belarusian ruble
After the denomination on July 1, 2016. 1 Belarusian Rube or the new version of BYN, the value is equal to 10,000 of the old version. The Belarusian state, which was established in 1992 due to the fall of the USSR, created their own currency, which was named the Belarusian Rube. The currency exchange rate was initially stable. However, due to high taxes, corruption, and political restrictions, the exchange rate of this currency weakens in global markets.
Currency code – BYR.
Belarusian Ruble exchange rate:
1 USD = 24.155 BYR (US Dollar to Belarusian Ruble – before denomination).
3. Ugandan Shilling
In 1966, the Ugandan Shilling appeared for the first time to replace the East African Shilling. Then this currency was also used as the official means of payment in Kenya, Uagnda, Zanzibar, and also Tanganyika. These currencies are classified as currencies with relatively stable exchange rates. Over the past few years, its value has never decreased by more than 5%.
Currency code – UGX.
Ugandan Shilling exchange rate:
1 IDR = 0.24 UGX (Indonesian Rupiah to Ugandan Shilling).
1 USD = 3,528 UGX (US Dollar to Ugandan Shilling).
Why Can Currency Exchange Rates Decrease?
One of the causes of the decline in the currency of a country is due to the country’s economic conditions. This causes a decrease in the stability of the increase in the inflation rate and also the stability of payments.
That is one of the consequences of an economic downturn due to war, declining GDP, falling commodity prices, political instability, and others. In addition, currency depreciation is also often associated with monetary policies that are not properly regulated and fiscal control decisions or the Central Banking System.
Those are some lists of the lowest currencies in the world, including Indonesia. To find out more about a country’s currency or country’s economy, Sinaumed’s can read the book recommendations that the author has provided in this article. Hope it is useful.