Macroeconomic convergence within EAC countries: towards a single currency

bibliographic database
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Periodical article

Title:	Macroeconomic convergence within EAC countries: towards a single currency
Author:	Ndereyahaga, Richard
Year:	2011
Periodical:	Cahier du CURDES
Issue:	12
Pages:	251-276
Language:	English
Geographic term:	East Africa
Subjects:	East African Community financial conditions monetary areas
Abstract:	The present paper investigates the extent of macroeconomic convergence in the East African Community (EAC) countries (Burundi, Kenya, Rwanda, Tanzania, Uganda) using the 'sigma convergence hypothesis' on the GDP growth rates, on the CPI (consumer price index) growth rates and on the monetary variables. With respect to GDP growth rate, a nominal variable, there is evidence of lack of convergence overall and some evidence of convergence on monetary policy variables in some instances, while no convergence has been found for fiscal policy variables. There is a strong need to increase policy harmonization and coordination within the EAC countries, so as to stimulate macroeconomic convergence and policy environment effectiveness. The national planning strategies should include stability criteria and macroeconomic convergence benchmarks to ensure effective convergence and bring the regional integration process to success. Bibliogr., sum. [Journal abstract]