The 7 nations of the East African Community (EAC) are set to launch a common regional bank in 2023, part of a road-map to having a single currency in the next 4 years.
East Africa Community (EAC) 🇰🇪🇹🇿🇧🇮🇷🇼🇨🇩🇸🇸🇺🇬 to set up regional central bank in 2023.
The Central Bank of East Africa will be key to implementing a single currency for the region in about 3 years pic.twitter.com/dPvEXkNoJy
— BitKE (@BitcoinKE) January 16, 2023
This is according to EAC Secretary-General, Dr Peter Mathuki, who said ministers from the respective nations are meeting to discuss the location of the East African Monetary Institute – the Central Bank of East Africa
“The EAMI will be in place this year in what will allow us to harmonize member states’ fiscal and monetary policies, then in about three years we will have a common currency in place.” – Secretary General, EAC
EAC has long envisioned creating the common currency to boost trade and movement of persons in the community and has already established a customs union and the common market protocol.
The organization, headquartered in Arusha, Tanzania, has also announced that trade within the region was increasing standing at US$10.17 billion by September 2022.
Here is the list of EAC member nations:
- Kenya
- Uganda
- Tanzania
- Rwanda
- Burundi
- South Sudan
- Democratic Republic of Congo (DRC)
“The intra-EAC trade, accounting for imports and exports in the 7 EAC Partner States, grew from 13% in 2019 at a value of $7.1 billion to 15 % in 2021 at a value of $9.5 billion. By September 2022, the EAC trade value was recorded at $10.17 billion representing a 20% share of Intra-trade to global trade.”
Dr. Mathuki disclosed that EAC’s total trade with the rest of the world stood at $62 billion, adding that there was still room for improvement.
In April 2021, the community secretariat indicated that it was consulting on the feasibility of a CBDC as it sought enhancements for the upgrade of the East Africa Payments System (EAPS).
The potential for a CBDC is expected to end reluctance by the member countries to trade in each others’ currencies given that the goal for a singe currency was expected in 2024 but experienced challenges in implementation.
On the EAC Political Federation, Dr. Mathuki said that national consultations for the EAC Political Confederation have so far been held for the Republics of Burundi and the Republic of Uganda.
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