African Unification Front
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Draft PAP Bill on Single African Currency
Single Currency is Answer to Funding Shortage
PROVISIONAL SUMMARY
FISCAL POLICY IN THE AFRICAN UNION
The African Union fiscal policy should include measures to address financial and industrial revitalization, and structural reform of the securities market. The Union must set up a securities depository, holding assets for its Participants and their customers. The securities depository will be an all-union clearinghouse for the settlement of trades in corporate, municipal and mortgage-backed securities and will perform asset services for its participating banks and broker/dealers. The securities depository must aim to process on an annual basis millions of book-entry deliveries.
In order to promote such structural reform, the Union must implement appropriate economic and fiscal management. The banking system of Africa must shift to monetary operations that target monetary aggregates, and implement policies that virtually have the effects of zero interest policy until the African economy becomes significantly more dynamic
While maintaining consistency with the basic principles of the Union's economic policies, it is necessary for the banking system to take appropriate flexible monetary policies.
Furthermore, there is a need to take into consideration the adjustments that must accompany structural reform. The African Union needs to advance regulatory and systemic reforms and innovations that will give rise to long-term economic vitality. Steps must also be taken to create new markets and greater employment through such reforms and develop a safety net for the employed workers.
Finally, the African Union must set up a Council on Economic and Fiscal Policy with the mandate to consider a blueprint for what the African economy and fiscal state should look like in the medium- to long-term. The Council should compile compile a solid policy framework with a view to dispelling the concerns of the people towards the future.
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printable version
