The Bank of Uganda has assured central bank governors from across the East African Community (EAC) that interest rates remain stable across the region, strengthening efforts to establish the long-awaited East African Monetary Union.
The assurance was given by the Governor of the Bank of Uganda, Dr Michael Atingi-Ego, who also chairs the EAC Monetary Affairs Committee, at the close of the extraordinary meeting of EAC Central Bank governors held at the Lake Victoria Serena Golf Resort in Kigo.
“I welcome all Central Bank Governors from partner states within the EAC for their commitment to push for the monetary union that will lay a solid foundation for the integration of our member states,” Atingi-Ego said.
He said stable interest rates across member states have been supported by diversified foreign exchange inflows, reforms in domestic foreign exchange markets and growing confidence in the region’s economies.
According to Atingi-Ego, the stable macroeconomic environment has been observed across EAC partner states including Uganda, Kenya, Tanzania, Rwanda, Burundi, South Sudan, Somalia and the Democratic Republic of Congo.
He said digital innovation in finance would be critical in accelerating the implementation of the monetary union.
Atingi-Ego said member states should adopt technologies that improve labour productivity, promote financial inclusion and support economic growth.
He added that expanding financial products and modern payment systems, improving the monitoring of economic activity and strengthening communication of monetary policy decisions would help fast-track the monetary union agenda.
The governor also called on EAC member states to develop policies that integrate the region’s economies and promote closer cooperation among partner states.
Despite global economic uncertainties, the Deputy Governor of the Bank of South Sudan, Wetuy Luony Babouth, said his country has continued to register economic progress through sound financial and macroeconomic management.
He said South Sudan has focused on promoting financial stability and implementing reforms to strengthen its economy.
Babouth added that close collaboration with the World Bank and the International Monetary Fund has helped the country improve public financial management and implement key economic reforms.
The Governor of the Central Bank of Kenya, Dr Kamau Thugge, commended the Bank of Uganda for successfully hosting the extraordinary meeting.
He also invited fellow central bank governors and regional stakeholders to join the Central Bank of Kenya in celebrating its 60th anniversary in September in Nairobi.
Meanwhile, the deputy secretary general of the EAC Secretariat, Annette Mutaawe Ssemuwemba, reminded participants that the recent EAC Heads of State Summit in Arusha expressed concern over the slow implementation of the monetary union roadmap.
She urged all institutions involved to speed up implementation in order to build a stronger foundation for regional political and economic integration.
“The heads of state observed that progress towards the monetary union has been slower than expected and called upon all stakeholders to expedite implementation,” Ssemuwemba said.
The East African Monetary Union is expected to establish a single regional currency that will facilitate trade and investment among partner states.
