Tuesday, July 23, 2024
HomeAfricaKenya Sells a Political Solution to Bloc’s Row on Monetary Institute

Kenya Sells a Political Solution to Bloc’s Row on Monetary Institute

Three East African Community (EAC) partner states that earlier rejected the process used to determine who should host the East African Monetary Institute (Eami) have proposed a new formula, choosing a political solution as proposed by Kenya.

“What Kenya is saying is that since this process is time-consuming, money-consuming and does not yield what it is supposed to yield, why can’t we vacate it for now and use a political process to allocate the institutions that are on the table currently?” said Abdi Duba, Kenya’s Principal Secretary for EAC Affairs.

Uganda, Tanzania and Kenya have each expressed interest in hosting the Eami but Kenya, Uganda and South Sudan rejected a report that recommended Tanzania to host the regional central bank. Only Tanzania and Burundi agreed with the report while the Democratic Republic of Congo and Rwanda sought an alternative to resolve the stalemate.

The last Council meeting that preceded the Heads of State Summit in Arusha in November observed that the determination of the seats of EAC organs and institutions has not been based on a technical procedure. The meeting welcomed Kenya’s proposal, which is expected to be presented to the Council by January 2024.

EAC has 12 organs and institutions with Arusha hosting the Secretariat, the East African Court of Justice, and the East African Legislative Assembly.

The indecision on who will host Eami, which will oversee a single currency, hasdelayed the kick-off of the third pillar of the EAC, the Monetary Union. The deadline was moved from 2023 to 2031.

The verification carried out in March ranked Tanzania most suitable to host the central bank, with a score of 86.3 percent, followed by Uganda (82.42 percent), Burundi (78.1 percent) and Kenya (77.35 percent). The other partners did not express interest.

Nairobi cried foul, saying the result was not reflective of a transparent process. Uganda has rejected the report and backed Kenya for another formula. South Sudan, too, supported Kenya.

Juba has requested to host one of the institutions or organs of the Community.

Kinshasa, at the time admission into the Community, expressed interest in hosting an institution responsible for natural resources and mineral development.

The Council directed Kenya to submit a comprehensive proposal by January 31, 2024. Thereafter, it will be presented to the EAC partner states by February 15, 2024 by the Secretariat who then should convene a meeting to consider the proposal by March 30,2024.

Currently the bills for the establishment of the three institutions under the Monetary Union Protocol have been passed by the Eala and are awaiting assent by the heads of state.

These are the East African Statistics Bureau, the East African Financial Services Commission, and the East African Surveillance Compliance and Enforcement Commission, hoping to unlock the impasse. The institute is the precursor to the proposed East African Central Bank.

Kenya has written to the EAC Secretariat proposing to amend the procedure for the seating of EAC organs and institutions pushing a political solution since the usual process has failed to yield consensus and has become time-consuming.

Kenya’s Principal Secretary for EAC Affairs Abdi Dubat said the conversation has been around the verification exercise.

“There is a lot of jostling and disagreements on issues. Even the procedures for ranking a country have been misunderstood and misinterpreted. So the process does not yield a result that has consensus and is accepted by everybody,” he said.

He said as a result Kenya is seeking a procedure that can yield results faster and without discriminating against other partner states.

“What Kenya is saying is that since this process is time-consuming, money-consuming and does not yield what it is supposed to yield, why can’t we vacate it for now and use a political process to allocate the institutions that are on the table currently?” said Mr Dubat.

Source: The East African

RELATED ARTICLES

TRANSLATE

Most Popular