The African Union’s endgame – a single currency under an African Central Bank (ACB) – is gaining traction, with its precursor, the African Monetary Institute, opening in September 2026. For union to succeed, central bank governors must settle where to begin converging. Leading with top-down macroeconomic alignment, such as bringing inflation, deficits and debt into line, risks delaying integration amid domestic fiscal crises. Converserly, starting with payment systems and banking prudential requirements offers immediate trade benefits but leaves currency volatility unaddressed. With the ACB’s 2028–2034 launch window approaching, which sovereign powers should central banks surrender first to prevent monetary integration from stalling?
Key points
- Which criteria take priority: aligning macroeconomic targets or unifying cross-border banking prudential rules?
- How can regional payment systems interlink effectively without exposing stable economies to external currency shocks?
- Private sector implications: What mechanisms will protect smaller, localised banking sectors during the transition to a single regulatory framework?