“This issue falls under one of SADC’s programme which saw the setting of Preferrianial Free Trade Area in 2008, the setting of the Customs Union in 2010 and the Monetary Union by 2016. We are however, going to deliberate about rescheduling it (Monetary union),” Prof Ncube said.
The proposed Ministers of Trade meeting is set for 29-30 September with the heads of state scheduled to meet some time in October for the second time this quarter. Both meetings are alleged to have been crafted solely for this contentious issue of a single monetary denomination.
South Africa’s central bank Governor, Tito Mboweni, was recently quoated as saying Southern African countries have fallen behind targets that will allow them to adopt a single currency by 2016.
Countries in the region have mot met “convergence criteria” on curbing inflation and government spending, Mboweni said at a conference hosted by the University of Free State in Bloemfontein, South Africa recently.
The 15 member nations of the SADC, a regional trading bloc, agreed to form a common central bank and adopt a single currency by 2016. To achieve that, countries were required to reduce their budget deficits to five percent of gross domestic product last year and bring inflation down to below 10 percent. Rising food prices and the global financial crisis pushed those targets out of reach for most countries in the region.
“We are very much behind schedule, Mboweni said. Inflation increased at an alarming rate in 2008 due in part to pressures from food and oil.”
SADC is comprised of South Africa, Angola, Botswana, DRC, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, Swaziland, Tanzania, Zambia and Zimbabwe.
Inflation in the DRC averaged 17.9 percent, reached 37 percent in Seychelles and climbed to 10.3 percent in Mozambique, Mboweni said. South Africa’s inflation rate has exceeded the central bank’s three percent to six percent target range since August 2007.