MONETARY UNION:Financial Markets; Key pillar

The Rwanda Central Bank Governor, Claver Gatete has said that the East African Community (EAC) needs to sustain its financial markets in order to make it operate with more efficiency.He made the remarks in a paper presented last week at a two-day regional conference on financial sector integration in Arusha, northern Tanzania. He listed several areas for the member states to improve their financial markets, including putting a stable macroeconomic environment, which is fundamental to promoting cross-border investment, according to the paper. He noted, however, that domestic debt markets in the region still face problems in meeting international standards. He said that secondary markets are illiquid and do not exist in some countries while bond markets are dominated by government bonds and very few corporate issuances.EAC financial markets integration is identified as one of the key pillars of establishing the region’s monetary union with objectives of contributing to mobilization of domestic savings and investments, efficient allocation of resources and harmonized regional laws and institutions.