The Africa Union in a significant move towards economic integration, has adopted the mobile money interoperability to boost inter-African trade and promote economic integration across Africa.
It has also adopted the establishment of the African Central Bank, African Investment Bank, as well as African Monetary Fund.
The AU believes that, using mobile money to buy and sell across the continent would quicken Africa’s economic integration as well as easy the way of doing business across borders of Africa.
The champion for the establishment of Africa’s financial institutions, Ghana’s President, Nana Addo Dankwa Akuffo-Addo proposed these two initiatives for adoption at the just ended 6th African Union Mid-Year Coordination Meeting in Accra Ghana.
The adaptation of these two recommendations now paves the way for the implementation of mobile money interoperability across the continent of Africa.
In the final report issued by the AU after the Accra meeting said in part that “iv. H.E Nana Addo Dankwa Akufo-Addo, President of the Republic of Ghana and AU Champion on AU Financial Institutions and ENDORSE the recommendations contained in the two reports namely:
* Establishment of the African Union Financial Institutions (AUFIs); and
• Scaling up Interoperability for Economic Integration: using mobile money to buy and sell across Africa
v. H.E Denis Sassou Nguesso, President of the Republic of Congo and Second Vice Chairperson of Bureau of the Assembly ENDORSE the recommendations contained therein.”
President Akufo-Addo who described the establishment of these financial instruments as “innovative” and ingenious had argued that Africa’s financial landscape are scattered with numerous institutions and initiatives operating in silos.
“This fragmentation, according to the President, had led to inefficiencies, duplication of efforts and a sub optimal utilisation of resources.
Some financial experts, say, consolidating AU’s fragmented financial institutions would it pull larger funds to finance the many infrastructure projects, boost trade and support the socio – economic development initiatives across Africa.
He had earlier at the meeting in Accra called for consolidation Africa Union institutions to provide the technical and strategic recommendations as to how this can be done.
Consolidating these institutions, according to him, would create a more cohesive and effective financial framework that would ensure that resources are allocated to where they’re most needed.
Central to the realisation of this vision, President Akufo-Addo emphasised is the establishment of the three African financial institutions — the African Central Bank, the African investment bank, and the African Monetary Fund.
The creation of these institutions, the President argued is vital to achieving the financial stability and economic integration necessary for the successful implementation of agenda 2063.
The African central bank, President Akufo-Addo maintained would also harmonise monetary policies and ensure currency stability across the continent, mitigate the risks associated with exchange rate volatility, and create a predictable economic environment that fosters investor confidence and facilitates intra African trade.
A stable and unified monetary policy the President averred would reduce transaction costs and increase the efficiency of our financial systems.
Concurrently, the African investment bank will be instrumental in mobilising and allocating resources for large scale development projects providing the financial backbone for key infrastructure and development initiatives and accelerating progress towards the highest durations of agenda 2063.
It will serve as a catalyst for investments in infrastructure technology and human capital, which are fundamental to transforming the socio economic landscape of Africa.
Additionally, President Akufo-Addo said the African Monetary Fund will provide financial assistance to member states facing balance of payments issues and economic shocks, boosting monetary cooperation and stability among African nations by reducing Africa’s dependency on external financial institutions and promoting sound fiscal and monetary policies.
The African Monetary Fund will support macroeconomic stability and entrench financial sovereignty across the continent.
“The consolidation of our financial instruments under these institutions will strengthen our position in the global financial system will enable us to negotiate from a position of strength and unity leveraging our collective resources and capacities to achieve our development goals.
He said by integrating the continent’s financial systems will not only create a more robust and resilient African economy, “but also improve the quality of life for our people through improved access to essential services and opportunities.”
Rex Mainoo Yeboah, ISD
