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Tanzania becomes the first country to ratify the Eac Monetary Union Protocol

The government has said that Tanzania’s ratification of the East African Community (EAC) Monetary Union Protocol on June 25th 2014 demonstrates that the country is not a stumbling block to regional integration.

The Deputy Minister for East African Cooperation Hon. Dr Abdulla Saadala said in Dodoma that Tanzania became the first country to endorse the instrument, making a big step ahead of its EAC peers.

“We have made a huge step and demonstrated our commitment to EAC regional integration. We are not by any means a stumbling block to the regional integration,” Dr Saadala said

The next step is to dispatch the instrument of ratification to the EAC Secretary General as required.

During debating on the Protocol, majority of MPs said that it was the right time to entre into third phase of EAC integration process as Tanzania is leading in macro-economic convergence criteria.

He said some Members of parliament had reservations on the ratification of the protocol especially due to geo-politics of the so called Coalition of the Willing (CoW) but economic indicators convinced them that the country was on right track to economic supremacy.

“We are consistent in our commitments to meet and maintain all macro-economic convergence criteria stipulated in the protocol. We reaping the benefits of sound economic policies no wonder we are among the top ten countries in Africa with an average of 7% GDP growth per annum,” Minister Saadala said

He said MPs were also convinced by the output generated by the government’s newly created strategy—Big Results Now (BRN).

Monetary Union Protocol is the third stage of EAC integration which will ultimately lead the five-member bloc to adopt a single currency regime by 2014.

The EACMU was signed by the EAC Heads of State on November 30 2013 in Kampala Uganda during the 15th Ordinary Summit.

The protocol will provide for a wide scope of co-operation in monetary and financial sectors among EAC members.

Under the protocol, EAC states are expected to surrender monetary and exchange rates policies to one authority leading to a single currency regime within the region.

The protocol will be implemented over a ten year period, subsequently leading to creation of a regional central bank whose mandate is to stabilize financial prices as well as monitoring, surveillance and enforcing compliance of all other macro finance matters.

He said the union will eliminate the costs attendant to juggling different currencies thereby reducing transaction costs.

The Deputy Minister also said the envisioned integration will work as intended when underpinned by a sound infrastructure therefore development of infrastructure connecting member states was key to the integration process.

During the World Economic Forum held in Nigeria recently noted that the central and southern corridor are the most profitable corridor for investment. Tanzania is therefore expecting to get investors in these corridors.

written by Vedastina and Faraja