Govt ratifying regional currency move
11 December 2013, 17:24
Nairobi - The country is in the process of ratifying the East African Community (EAC) Monetary Union’s move towards a single currency in the region by 2024.
The Cabinet Secretary for East African Affairs and Tourism, Phyllis Kandie, affirmed Kenya’s dedication to a single currency regime with the rest of the EAC partner states.
“After the five heads of states signed the protocol (in Uganda) the next stage will be to embark on the long journey of implementing the protocol. The implementation will be guided by the roadmap on East African Monetary Union,” she said.
The roadmap identifies activities to be implemented before a single currency is introduced.
It sets timelines for achievement of macro-economic convergence, financial integration and when to establish various institutions to support monetary union.
She was speaking to the press during in a briefing on Wednesday afternoon.
Cabinet secretary for the National Treasury, Henry Rotich, together with the Governor of the Central Bank, Prof. Njuguna Ndung'u, attended the event.
Rotich said the success of the monetary union requires the flexibility of the labour market and the free movement of capital across the member states of the EAC.
“The advantages of monetary union include consolidation of a single market, price convergence and stability, increased capital inflow, certainty to business and foreign direct investors. Fiscal discipline among member states and increased integration between resulting in more economic development are benefits that will accrue with an EAC monetary union,” he said.
Prof. Ndung'u said the establishment of a monetary institute in the region would aid in implementation of the single currency before 2024.
It is among the four institutions necessary.
“The institutions necessary for the implementation of the East African Monetary Union include the East African Monetary Institute, Statistics Bureau, Surveillance and Compliance Enforcement Commission and the East African Financial Services,” said Ndung'u.
– CAJ News