East Africa: EALA receives key bills paving the way for regional monetary union

The East African Community (EAC) Council of Ministers on Tuesday March 1 finally tabled in the regional parliament three bills that will pave the way for the establishment of the African Monetary Institute of the East (EAMI).

The legislations are; the EAC Financial Services Commission Bill, the EAC Supervisory Compliance and Enforcement Bill and the Standardization, Accreditation and Conformity Assessment Bill of the EAC.

Two other relevant Bills – the EAC Monetary Institute Bill, 2017 and the EAC Bureau of Statistics Bill, 2017 were introduced in the Assembly in 2018.

The EAMI is a transition mechanism to the East African Central Bank that will issue the single currency which is expected to be in place by 2024, if all goes as planned. This regional monetary institute, precursor of a regional central bank, is one of the four institutions supposed to carry out much of the preparatory work for the creation of the East African Monetary Union (UEMOA), an important step in the regional integration agenda.

The EAMU is the third integration pillar of the six-member bloc preceding the ultimate phase – the EAC Political Federation.

The three bills are among the essential elements of the order paper which could not be tabled last week because lawmakers decided they would not proceed in the absence of the ministers in charge of EAC affairs – and nothing would ultimately be implemented.

EALA President, Martin Ngoga (Rwanda) said it was a “great positive development” as it was the first time that the Council of Ministers tabled three bills at once at the Bedroom.

“These are bills that take us to another level of integration. We will work with the Council to ensure that we deal with these bills as soon as possible,” Ngoga said.

The bills were introduced by Rebecca Kadaga, Uganda’s First Deputy Prime Minister and Minister for EAC Affairs, who replaced Kenya’s Cabinet Secretary for EAC Affairs, Betty Maina.

Maina, who is now president of the Council of Ministers, practically took an oath to join the assembly on Tuesday as an ex-officio member. She succeeds Kenya’s former EAC and Regional Development Cabinet Secretary, Adan Mohamed, who resigned on February 8 to contest a political seat in his country’s upcoming general elections.

Addressing the Assembly shortly after being sworn in, Maina “sincerely” apologized on behalf of the Council for the interruption of parliamentary proceedings last week due to the resignation of his predecessor.

Ngoga said what happened last week was an unfortunate situation which the Assembly hopes will not be repeated.

He said: “We hope this unfortunate situation has reminded everyone that we have to take things seriously.”

Shedding light on the bills, EAC Kenya Permanent Secretary Kevit Desai told The New Times that the EAC Financial Services Commission Bill 2022, upon enactment and of its rise, aims to promote the integration of financial systems in the community and to harmonize regulation and supervisory practices in the non-banking financial sector.

The EAC Supervisory Compliance and Enforcement Bill, when enacted and ascended, will among other things assess the achievement of macroeconomic convergence by the EAC Partner States and monitor and regularly enforce the macroeconomic convergence criteria by the participating partner states.

“Macroeconomic convergence criteria are one of the mandatory requirements that must be met for the establishment of the EAC Monetary Union,” he said.

He said that the EAC Standardization, Accreditation and Conformity Assessment Bill, “when enacted and ascended, shall provide for the standardization, accreditation and assessment of conformity of products marketed in the community in order to facilitate the development of industrialization and trade in order to make arrangements to ensure the protection of the health and safety of society and the environment in the community.

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