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Not So Fast

The AUC announced it was stepping up the pace of the implantation of a pan-African currency that it hoped to have in circulation by no later than 2025
By The News · 18 of October 2016 08:51:36
Not all African nations are on board for unified currency, No available, photo: Wikipedia

When Aisha Abdullahi, head of political affairs of the African Union Commission (AUC) — a body roughly analogous to the European Commission — spoke before the V International Humanitarian Forum in Baku, Azerbaijan, late last month, her message was loud and clear: The once-lost continent that had become synonymous with endless sectarian fighting and violent feudal warfare has finally begun to get its act together and will soon become a pancontinental bloc of regional free trade with the unobstructed movement of people across geographic borders.

Abdullahi said that the AUC has already begun to recruit consultants who are busily formulating plans for an African single market, targeted to be implemented by 2017.

Though still in its infancy, the idea of an economically and commercially unified Africa is a multifarious and ambitious proposal, but it could be the best hope for bringing peace to a continent that has known only war and poverty for nearly half a century.

The initial phase of the establishment of a single market was presented earlier this year, when representatives from 25 African nations signed an agreement to link three existing economic blocs into a commercial community that would unite 57 percent of the continent’s population.

That Tripartite Free Trade Agreement (TFTA) would bring together more than 60 percent of the continent’s gross domestic product, valued at $1.2 trillion.

The TFTA would be primarily aimed at boosting the continent’s competitiveness in global trade and lifting millions of people across the continent out of poverty.

Still, there will be a lot entailed in the scheme to unify Africa, and, as the AUC may soon find out, the devil will be in the detail.

Last June, the AUC announced it was stepping up the pace of the implantation of a pan-African currency that it hoped to have in circulation by no later than 2025.

It also outlined the framework for the creation of an African Monetary Fund.

The African Union said it believed that these measures will attract higher levels of inward investment and connect all the countries in Africa through world-class infrastructure, making it an attractive destination for foreign capital and new transnational industrial ventures.

There will also have to be an African central bank that will be responsible for issuing the common currency, and a monitoring body to oversee its solvency.

The leaders of Kenya, Uganda, Tanzania, Rwanda and Burundi have already signed a protocol in the Ugandan capital of Kampala for the adoption of a common currency in 10 years.

And Rwanda and Benin announced plans to allow mutual visa-free entry, while Zimbabwe has already eliminated visa restrictions for citizens traveling from within the 15-nation South Africa Development Community.

In July, the African Union also announced it had finally agreed on an all-Africa, 54-nation passport to do away with visa restrictions.

The AU Commission director, Nkosazana Dlamini Zuma, called the move a “first step toward … a strong, prosperous and integrated Africa, driven by its own citizens and capable of taking its rightful place on the world stage.”

But putting the concept into practice may turn out to be more complicated than the AUC anticipated.

Although diplomats were promised access to the passports by 2018, it quickly became clear that the continent’s 1.1 billion people are going to have to wait much longer because each of the participating countries’ legislators will have to pass a bill endorsing it.

Moreover, Africa has an estimated $50 billion annual infrastructure funding gap, meaning money to fund the transition will be scarce.

And as for the idea of a unified currency, not all African nations are on board.

Some member countries fear that they could lose out from a single coinage, undercut by the disparate economic strengths of the various economic blocs.

There are also the contentious issues of migrants and refugees that must be dealt with, and religious divisions and political power struggles that have for decades overshadowed economic interests.

Africa — a continent that still bears the scars of the arbitrary map-drawing of the colonial era — is desperately struggling to find a way out of the vicious cycle of bloodshed, territorial disputes, ethnic divisions and extreme poverty that were the legacy of centuries of Western exploitation.

Continental unity of any sort would certainly be a major cornerstone in achieving that goal.

Let us hope that this lofty aspiration is not crushed by the harsh realities of geopolitical forces and underlying disputes that could ultimately keep the African integrationist dream from reaching fruition.

Thérèse Margolis can be reached at therse.margolis@gmail.com.