Last week the East African Community (EAC) registered another success towards integration. Participants drawn from the five member states attended a three day validation workshop of the draft final report of the Monetary Union study in Kampala last week. The plan is supposed to lead to the establishment of a single currency for the whole region.
In fact last year in June 2, the EAC had long running discussions with the European Central Bank (ECB) in which the two sought mechanisms regarding the establishment of East African Monetary Union (EAMU) among the partner states.
The ECB did preliminary research on the study that was presented at a three day workshop held in Kampala last week.
The report followed preliminary findings from consultations in the partner states that were launched by the EAC Secretariat in September 2009.
One of the areas to be looked at critically is the harmonization of the exchange rate realignment. Our experts will have to grapple with very challenging trade regimes, tax issues, export-import mechanisms, labour issues and the need for a uniform interest rate regime in all the five countries.
This calls for cautious and planned negotiation on the protocol but most importantly, the single currency will propel the region into a strong monetary and economic union that should substantially transform the lives of the 120million or so people.
Each of the five countries has its strategic advantages and unique selling points. These should be harnessed to bolster a strong economic and financial framework capable of attracting investment, production and growth at a time when the world is seeking for better investment destinations.
The region has the requisite human resources, raw materials, is naturally endowed with some of the best natural and historical features. With this in mind, the monetary union and single currency should be able to once our leaders and implementers can plan well.