There are rising doubts concerning the regional financial bloc often called the East African Community’s capability to efficiently launch a single foreign money by 2024, a report has stated. One of the explanations for that is member states’ delays in meeting targets as set out within the roadmap.
Attainment of Single Regional Currency a Top Priority for the EAC
Central banks from an African financial union, the East African Community (EAC) are reportedly not sure if plans to introduce a single foreign money for the area by the year 2024 shall be realized. The central banks cite some member states’ failure to meet targets as set out within the roadmap as one of many the explanation why the one foreign money is unlikely to take off as deliberate.
As per a report within the East African, members of the six-nation East African Community hope that the envisaged frequent foreign money will assist scale back the prices related to changing currencies. There are additionally hopes the one foreign money, whose attainment is likely one of the EAC’s priorities for the interval between 2022 and 2026, will eradicate the change rate volatility that comes with cross-border buying and selling.
Meanwhile, in a communique reportedly launched on August 22, the EAC confirmed that delays and different challenges meant the regional bloc can’t have a single foreign money by 2024 as deliberate.
“The Committee noted that there have been delays in realising targets set out in the EAMU [East African Monetary Union] roadmap and that there are several challenges that could further impede the timely implementation of EAMU protocol. Therefore, the Committee pledged to work with the EAC Secretariat and other stakeholders in the EAC integration process to fast-track pending activities of the EAMU roadmap,” the EAC communique defined.
Harmonization of Monetary and Forex Policies
Still, regardless of its acknowledgement that the method to set up a single regional foreign money has been beset by challenges, the EAC nonetheless claimed that associate states’ central banks had achieved some progress.
According to the East African report, a few of the central banks’ achievements embrace the creation of the East African Monetary Union (EAMU) in addition to the harmonization of foreign exchange and financial insurance policies.
Other achievements are stated to be the harmonization of regulatory regimes, the advance of cybersecurity frameworks, and the application of measures which strengthen cost techniques.
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