Currencies, Emerging Markets, Frontier Markets

Building A Monetary Union In Africa

It’s like the European Union but for East Africa.

East African Federation Flag

East African Federation Flag

By iMFdirect

In this podcast by the IMF, find out how Uganda, Kenya, Tanzania, Rwanda and Burundi stand to benefit from the creation of the East African Community*.  There will be a common currency as well as more trade and investment too.  Will a union also expose them to more risk?

These five countries have already seen some benefits from regional integration.

“It took more than three weeks to move goods from Kenya or Tanzania to Uganda; now it takes four to six days,” said the IMF’s Oral Williams, one of the editors of a recent book on the East African Community.

Maybe Europe should take a page out of Africa’s playbook.  Listen and decide for yourself.

Courtesy of IMF

East African Federation Logo

East African Federation Logo

*) “The East African Federation (Swahili: Shirikisho la Afrika Mashariki) is a proposed political union of the five sovereign states of the East African Community – Burundi, Kenya, Rwanda, Tanzania and Uganda – as a single federated sovereign state.

At 1,820,664 km², the East African Federation would be the fourth largest nation in Africa and seventeenth in the world. With a population of 153,301,178, it would also be the second most populous nation in Africa (after Nigeria) and tenth in the world. Its population would be larger than that of Russia, Japan and Mexico, and half that of the United States. The population density would be 84.2 people/km².

Swahili would be the lingua franca and the official language would be English. The proposed capital is the Tanzanian city of Arusha, which is close to the Kenyan border. Arusha is the current headquarters of the East African Community.

The union’s proposed currency would be the East African shilling, already slated to become the common currency of the five countries in 2015 or later. The GDP (PPP) by (CIA World Factbook) estimate would be US$297,791,000,000 and be the fifth largest in Africa and 48th in the world. The GDP per capita would be US$1,942.” (Source: Wikipedia)

About ETFalpha

Chief ETF Strategist & Co-Founder at EMerging Equity


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