Adopting an Africa-wide currency is unlikely as there are too many difficulties in getting “macroeconomic convergence”, according to South Africa’s Central Bank Governor,
Lesetja Kganyago said that the adoption of a single currency, to mirror the introduction of the euro in Europe, would require similar levels of inflation, debt, consistent fiscal policies and banking rules among nations on the continent.
Kganyago, who was speaking during a wide-ranging interview with Metro FM radio on Tuesday also said plans by the leaders of the BRICS group of nations (Brazil, Russia, India, China and South Africa) to have a common currency would require a fiscal union similar to the European Union.
“If the BRICS political leaders say that is where they are going, you’ll have to get a fiscal union, you’ve got to get macro-economic convergence,” Kganyago said.
With regard to an African currency, he said: “Importantly, you need a disciplining mechanism for countries that fall out of line with it. And the euro project demonstrated just that.”