Currencies in the Southern African Development Community (SADC) should converge with the South African rand and the Botswana pula as the bloc develops monetary union, South Africa?s central bank head Tito Mboweni said yesterday. Mboweni told a business breakfast that South Africa, with the continent?s biggest economy, should play the main role in plans to achieve monetary union in the 13-member bloc by 2016. ?It is very clear to me that eventually the (SADC) currency will have to converge around the South African rand and the Botswana pula,? Mboweni said.

?The biggest economy in the region should play the biggest role. If you are 90 percent of the economy you should play 90 percent of the role...there is nothing dishonorable about exercising your power.? South Africa?s rand is by far the most important unit on the continent. The pula is also seen playing a key role as it has been relatively stable for years in a continent beset by currency woes.

Mboweni said SADC central bank governors were meeting twice a year to ensure that goals set along the path towards monetary union were met? including lowering inflation to below 5 percent by 2012 and having a common market by 2015. Mboweni said he had travelled around the region this year as part of efforts to convince every finance minister in the bloc to accept the idea that their central banks must be independent and accountable to their citizens, rather than government. ?It?s not an easy task,? he said.

SADC comprises the continent?s powerhouse, South Africa, along with Angola, Botswana, the Democratic Republic of Congo (DRC), Lesotho, Malawi, Mauritius, Mozambique, Namibia, Swaziland, Tanzania, Zambia and Zimbabwe. The bloc also aims to reduce budget deficits to less than 3 percent of GDP and set goals for foreign exchange reserves. Mboweni said it would make sense for the common monetary area comprising South Africa, Lesotho, Swaziland and Namibia to form the basis of a regional central bank, which could then invite other SADC states to join.

?This is my personal view, but it seems obvious to me that this should happen,? he said. He also said he felt that in the march towards a common African currency, the continent?s biggest trade bloc, the Common Market for Eastern and Southern Africa (COMESA) should disband due to the overlap in membership it had with SADC. ?If they closed COMESA and we focused energy on SADC and the East African community it would be better,? he said. COMESA has 19 members and is aiming to esablish a customs union by 2008.

<B>Mariam Isa</B>