The study of loanwords, and of language contact more generally, is a useful tool in tracing encounters and exchanges between different communities in the past. Loanwords often come in sets related to specific semantic fields, illustrating the nature of exchanged goods and ideas, as well as the nature of contacts between those communities, for instance, economic exchanges or political dominance. Examples include the adoption of new crops and subsistence techniques, in both ancient and recent periods, and the strong Arabic influence in multiple domains on the Swahili language. Loanwords are but one outcome of language contact. More intense contacts can lead to structural borrowing; to convergence between nonaffiliated languages, resulting in linguistic areas; and to language shift. The languages of so-called pygmy hunter-gatherers are a notorious example of people abandoning their own language in favor of a new one. To identify loanwords and to distinguish them from inherited vocabulary, it is necessary to apply the comparative linguistic method. Irregular sound correspondences and morphological traits, and a continuous distribution across linguistic boundaries are indicative of borrowing. The possibility of semantic analysis and the presence of cognates in related languages may confirm the identity of the donor language. The identification of loanwords suffers from a few drawbacks, however. Some sounds have not changed for centuries or even millennia, preventing the distinction between loans and inherited words. Or loanwords may have become integrated in the phoneme inventory of the recipient language, giving the impression of regular sound correspondences. But even if loans can be recognized as such, the donor language cannot always be traced. Finally, it must be said that the study of loanwords attains the best results when it is based on well-annotated data, with detailed semantic description and a list of regular sound correspondences and adequate classification at hand.