Economy
A Look at Unstable Economies: What are the Weakest Currencies in 2025?
While people are mostly turning their heads at the most powerful currencies worldwide, it is always a good idea to glance at the weakest, to learn from their stories and mistakes. Every country worldwide wants to achieve economic stability, as this shows strength. Still, this objective has become challenging as we are dealing with a lot of problems worldwide, including political issues, inflation, and economic concerns.
Weak currencies have low buying power, and at the moment, the weakest currency in the world is the Lebanese pound. The Iranian Rial, the Laotian Kip, the Uzbekistani Som, the Syrian Pound, the Guinean Franc, and the Paraguayan Guarani follow this currency.
In this article, we will analyze the factors that can impact a currency’s strength and delve into the world’s weakest currencies. Keep reading to learn more.
What are the factors that impact the strength of fiat money?
Economic factors
Economic factors are among the most important aspects that can tell whether a currency is strong or weak. Ideally, a country should have a low inflation rate so that it can have better purchasing power over other currencies. On the other hand, countries with high inflation will experience a depreciation in their currencies, as this will also lead to high interest rates, which will impact the strength of a currency.
So, a combination of inflation, interest rates, and exchange rates determines whether a currency is strong or weak.
Political factors
Politics will also impact the strength or weakness of a digital coin. Unfortunately, many countries around the world are experiencing political issues, such as corruption or government changes, that can lead to currency devaluation. When important political events occur, like wars, citizens will be more inclined to exchange their money for another currency, which can create even more devaluation.
The collapse of the Lebanese pound is the result of poor political and economic management. Other countries dealing with weak currencies are North Korea and Iran, which have received many international sanctions over the years. Because of this, they have not been as open to global financial markets.
External factors
External factors can also determine whether a currency remains strong or weakens. When a high number of investors are interested in a coin, they can make it even stronger. Additionally, countries own a foreign exchange reserve, representing the holdings of a country of liquid assets and foreign currencies, which nations can use when they want to stabilize their currency. Of course, the ones with a high reserve can better protect themselves from financial shocks. The ones with a high reserve, like Switzerland and China, have the means to prevent currency depreciation.
On the other hand, those with little reserves, like Sri Lanka and Pakistan, are more inclined to devalue their currency. Additionally, a nation’s resources, such as gas, oil, gold, or agricultural goods, can also impact the value of a currency. In this regard, when the price of a commodity rises, a country can gain more revenue and strengthen the position of its currency. This also occurs in reverse.
What are the weakest currencies in the world?
Lebanese pound (LBP)
At the moment, the Lebanese pound is the weakest currency in the world. The fiat money of Lebanon has struggled to maintain a high position and has suffered significant depreciation. This is the result of massive economic challenges, political instability, hyperinflation, and crisis. The ones who have felt the disadvantages of this are the Lebanese, who now need to face the effects of currency devaluation. Corruption and the collapse of the banking sector are other reasons that have led to the devaluation of the currency.
Iranian Rial (IRR)
The second weakest currency title belongs to the Iranian rial, as a result of the heavy sanctions that were imposed on this country back in 2015. Then, the Iranian rial also depreciated because it went through new pressure due to the tensions in the Middle East. Because of the sanctions, Iran hasn’t been able to participate that much in international trade, and this is also accompanied by political instability and high inflation.
Laotian Kip (LAK)
The Laotian Kip was also a weak currency in 2015. It is in its current state because of many factors, among the most obvious ones being high inflation, foreign debt, and economic pressures. Trade imbalances, lack of industrialization, and limited foreign investment are other reasons for this.
Uzbekistani Som (UZS)
Uzbekistan has important gas and oil reserves, which is why some might say that this country has everything it needs for a high-value currency. However, this doesn’t apply to Uzbekistan, which has struggled to maintain a high currency value. Unfortunately, Uzbekistan didn’t recover from the Soviet era, and this can be seen in the high inflation and corruption.
Syrian Pound (SYP)
The Syrian pound has become a weak currency because of economic sanctions and the civil war, which has affected this country’s currency. Investors are not interested in investing in this currency, and residents are very inclined to move their money into other currencies to escape inflation.
Conclusion
Unfortunately, many countries around the world have unstable economies, which greatly impact currency devaluation. Unstable countries are synonymous with high inflation, which decreases a coin’s purchasing power. Unfortunately, not many countries recover from unstable economies, as this can create a vicious cycle that, in the end, will impact currency value.
Investors are less likely to risk putting their money in unstable economies, where countries are dealing with corruption and high inflation. The political instability can lead to even more losses in the value of a currency, and this has been seen in numerous examples over the years.
By Adedapo Adesanya
The United Kingdom via the British High Commission in Abuja has launched two flagship economic reform programmes – the Nigeria Economic Stability & Transformation (NEST) programme and the Nigeria Public Finance Facility (NPFF) -as part of efforts to support Nigeria’s economic reform and growth agenda.
Backed by a £12.4 million UK investment, NEST and NPFF sit at the centre of the UK-Nigeria mutual growth partnership and support Nigeria’s efforts to strengthen macroeconomic stability, improve fiscal resilience, and create a more competitive environment for investment and private-sector growth.
Speaking at the launch, Cynthia Rowe, Head of Development Cooperation at the British High Commission in Abuja, said, “These two programmes sit at the heart of our economic development cooperation with Nigeria. They reflect a shared commitment to strengthening the fundamentals that matter most for our stability, confidence, and long-term growth.”
The launch followed the inaugural meeting of the Joint UK-Nigeria Steering Committee, which endorsed the approach of both programmes and confirmed strong alignment between the UK and Nigeria on priority areas for delivery.
Representing the Government of Nigeria, Special Adviser to the President of Nigeria on Finance and the Economy, Mrs Sanyade Okoli, welcomed the collaboration, touting it as crucial to current, critical reforms.
“We welcome the United Kingdom’s support through these new programmes as a strong demonstration of our shared commitment to Nigeria’s economic stability and long-term prosperity. At a time when we are implementing critical reforms to strengthen fiscal resilience, improve macroeconomic stability, and unlock inclusive growth, this partnership will provide valuable technical support. Together, we are laying the foundation for a more resilient economy that delivers sustainable development and improved livelihoods for all Nigerians.”
On his part, Mr Jonny Baxter, British Deputy High Commissioner in Lagos, highlighted the significance of the programmes within the wider UK-Nigeria mutual growth partnership.
“NEST and NPFF are central to our shared approach to strengthening the foundations that underpin long-term economic prosperity. They sit firmly within the UK-Nigeria mutual growth partnership.”
By Aduragbemi Omiyale
A strategic partnership aimed at accelerating the growth, digital capacity, and sustainability of Nigeria’s 40 million Micro, Small and Medium Enterprises (MSMEs) has been signed by MTN Nigeria and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN).
The collaboration will feature joint initiatives focused on digital inclusion, financial access, capacity building, and providing verified information for MSMEs.
With millions of small businesses depending on accurate guidance and easy-to-access support, MTN and SMEDAN say their shared platform will address gaps in communication, misinformation, and access to opportunities.
At the formal signing of the Memorandum of Understanding (MoU) on Thursday, November 27, 2025, in Lagos, the stage was set for the immediate roll-out of tools, content, and resources that will support MSMEs nationwide.
The chief operating officer of MTN Nigeria, Mr Ayham Moussa, reiterated the company’s commitment to supporting Nigeria’s economic development, stating that MSMEs are the lifeline of Nigeria’s economy.
“SMEs are the backbone of the economy and the backbone of employment in Nigeria. We are delighted to power SMEDAN’s platform and provide tools that help MSMEs reach customers, obtain funding, and access wider markets. This collaboration serves both our business and social development objectives,” he stated.
Also, the Chief Enterprise Business Officer of MTN Nigeria, Ms Lynda Saint-Nwafor, described the MoU as a tool to “meet SMEs at the point of their needs,” noting that nano, micro, small, and medium businesses each require different resources to scale.
“Some SMEs need guidance, some need resources; others need opportunities or workforce support. This platform allows them to access whatever they need. We are committed to identifying opportunities across financial inclusion, digital inclusion, and capacity building that help SMEs to scale,” she noted.
Also commenting, the Director General of SMEDAN, Mr Charles Odii, emphasised the significance of the collaboration, noting that the agency cannot meet its mandate without leveraging technology and private-sector expertise.
“We have approximately 40 million MSMEs in Nigeria, and only about 400 SMEDAN staff. We cannot fulfil our mandate without technology, data, and strong partners.
“MTN already has the infrastructure and tools to support MSMEs from payments to identity, hosting, learning, and more. With this partnership, we are confident we can achieve in a short time what would have taken years,” he disclosed.
Mr Odii highlighted that the SMEDAN-MTN collaboration would support businesses across their growth needs, guided by their four-point GROW model – Guidance, Resources, Opportunities, and Workforce Development.
He added that SMEDAN has already created over 100,000 jobs within its two-year administration and expects the partnership to significantly boost job creation, business expansion, and nationwide enterprise modernisation.
By Adedapo Adesanya
The Nigerian Exchange (NGX) Limited is seeking review of the controversial Capital Gains Tax increase, fearing it will chase away foreign investors from the country’s capital market.
Nigeria’s new tax regime, which takes effect from January 1, 2026, represents one of the most significant changes to Nigeria’s tax system in recent years.
Under the new rules, the flat 10 per cent Capital Gains Tax rate has been replaced by progressive income tax rates ranging from zero to 30 per cent, depending on an investor’s overall income or profit level while large corporate investors will see the top rate reduced to 25 per cent as part of a wider corporate tax reform.
The chief executive of NGX, Mr Jude Chiemeka, said in a Bloomberg interview in Kigali, Rwanda that there should be a “removal of the capital gains tax completely, or perhaps deferring it for five years.”
According to him, Nigeria, having a higher Capital Gains Tax, will make investors redirect asset allocation to frontier markets and “countries that have less tax.”
“From a capital flow perspective, we should be concerned because all these international portfolio managers that invest across frontier markets will certainly go to where the cost of investing is not so burdensome,” the CEO said, as per Bloomberg. “That is really the angle one will look at it from.”
Meanwhile, the policy has been defended by the chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr Taiwo Oyedele, who noted that the new tax will make investing in the capital market more attractive by reducing risks, promoting fairness, and simplifying compliance.
He noted that the framework allows investors to deduct legitimate costs such as brokerage fees, regulatory charges, realised capital losses, margin interest, and foreign exchange losses directly tied to investments, thereby ensuring that they are not taxed when operating at a loss.
Mr Oyedele also said the reforms introduced a more inclusive approach to taxation by exempting several categories of investors and transactions.
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