Monday, March 2, 2009

Africa to adopt single currency

Delegates from various African nations follow proceedings during the First Congress of African Economists in Nairobi. The delegates deliberated on the adoption of a single continental currency. Photo/CHRIS OJOW

Delegates from various African nations follow proceedings during the First Congress of African Economists in Nairobi. The delegates deliberated on the adoption of a single continental currency. Photo/CHRIS OJOW  

By JOSEPH BONYO and DAVE OPIYO

The push for a single currency to facilitate trade and help fast-track the integration of African countries has begun.

Top African economists and academics are attending a meeting in Nairobi whose theme is “Towards the creation of a single African currency”.

The three-day congress, which started on Monday, is expected to deliberate on possibilities of adopting the single currency.

The African Union, through its Economic Affairs Department, organised the workshop, whose recommendations will be presented to a heads of states summit in July.

According to AU commissioner for Economic Affairs, Mr Maxwell Mkwezalamba, the process of establishing a common currency was part of the Abuja Treaty aimed at uniting the continent both economically and politically.

“For the integration to yield benefits, greater volumes of trade among members must take place and one of the key elements of this is to eliminate multiple currencies and move towards adoption of a single currency,” said Mr Mkwezalamba.

Signed in 1991, the Abuja Treaty gave consent to establishment of the African Economic Community under the larger umbrella of the AU.

The treaty sought to establish institutions that include the African Central Bank to be based in Abuja, Nigeria, African Investment Bank (Libya) and African Monetary Fund (Cameroon) to be in charge of the continent’s financial issues.

Proposed name

At inception, the treaty proposed the name Afro for the single currency.

The treaty also proposed the introduction of the Afro by 2028, with the African Central Bank being the sole issuer of the currency. Already the AU Commission is taking steps to establish the bank in Abuja.

“The forum is useful in pointing out what measures and benchmarks are ideal if we aspire to have one currency,” Planning and National Development minister Wycliffe Oparanya told the delegates.

The search for a single currency for the continent comes at a time most economic blocs are pursuing the same strategy.

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