East African leaders sign protocol establishing EAC Monetary Union

Leaders from Uganda, Kenya, Tanzania, Rwanda and Burundi on Saturday signed a protocol to establish the East African Monetary Union, a key pillar in the region's economic integration process. Uganda's Yoweri Museveni, Kenya's Uhuru Kenyatta, Tanzania's Jakaya Kikwete, Rwanda's Paul Kagame and Burundi's Pierre Nkurunziza signed on behalf of their respectful countries. The signing of the Monetary Union Protocol set the stage of an eventual phasing out of national currencies paving way for a single regional currency. "This is an historic and momentous moment to our Community," Kenyan President Uhuru Kenyatta said before signing. "Our region is poised to enter an accelerated phase of integration with the signing and entry into force of the Monetary Union," said Richard Sezibera, Secretary General of East African Community (EAC). The protocol provides that member states maintain an inflation rate ceiling of 8 percent. Countries will be expected to sustain their debt to GDP ratio at not more than half, and a tax to GDP ratio of 25 percent to qualify to join the Monetary Union. During the meeting, Uganda handed over the rotational chairmanship of the EAC to Kenya. The EAC already boasts of having a Customs Union and a Common Market. It has a combined population of over 135 million people and GDP of 84.7 billion U.S. dollars.