East African Community denies launch of common currency

A post on social media shared by an account named “Government of East Africa” indicated that the common currency had been launched under the name “The East African Sheafra”.

“The East African Sheafra of SHF.5 Currency Note of fuv5 has finally Landed,” one post said.

According to the post, the said currency is a combination of the shilling of East Africa and Franc with an image of a banknote to depict that.

However, the EAC dismissed the claims, indicating that work is underway by leaders of the regional bloc to facilitate the launch of a common currency for the region to facilitate trade.

At a press conference on March 4, the Secretary General of EAC clarified that a roadmap has already been laid by the Director of Finance and the foundation is being laid towards the launch of the currency.

According to Dr Peter Mathuki, these suggestions on social media are only indicative of the need to speed up processes leading to the launch and introduction of the common currency for the good of all within the region.

“Some people from East Africa excited us by moving ahead of us by telling us that we have our currency. I wish it was true, it was fake news but very fulfilling news to me as the secretary general but that tells us people are ahead of us in terms of the bureaucracy. So the issues we keep talking about, harmonisation of some standards and systems so that it can happen, the people themselves are saying that we need that currency very fast so that it can facilitate trade because why would we want to move from one country to another, carrying another currency and then you change that currency to get the local currency,” he said in a post on the EAC page on X.

“I think it’s high time we need to move fast and while we appreciate the pressure coming from the people and the bloggers, we need to move with speed so that we can realise the common currency. The roadmap that has been read by the Director of Finance of 2030, is an indicative, only how I wish we could work faster to make sure that this is realized,” he added.

In line with this he said, there is a scheduled retreat for leadership of the EAC and foreign ministers within the bloc to dialogue and deliberate on the way forward.

“It is the intention of the council of ministers and a directive that we need to move with speed. And, therefore, the retreat of the ministers, ministers of EAC, ministers of foreign affairs will be meeting at a retreat later this month to look at some of these things and see how we can fast-track to ensure that we realise the full benefits of regional integration because that is the essence of coming together as a community,” Dr Mathuki indicated.

The EAC has adopted the East African Monetary Union in accordance with the EAC Treaty which lays the groundwork for a monetary union and allows EAC Partner States to progressively converge their currencies into a single currency in the community. The launch of the currency was extended in 2022 for reasons that the customs union and common market protocols had not been implemented leading to a failure in attaining the monetary union for the common currency.

All partner states will have to observe the macro-economic convergence criteria of headline inflation of 8 per cent, the gross public debt of 50 per cent, a reserve of 4.5 months of import cover, and the ceiling on the overall deficit of not more than 3 per cent of GDP including grants. Burundi and Kenya have not been able to achieve this with their current debt ceiling resulting in an extension.