EAC Countries Divided on Creating a Common Currency; Rwandans, Burundians, Ugandans receptive; Kenyans, Tanzanians more skeptical.
Synopsis: The East African Community's next goal -- creating a common currency by 2012 -- gets mixed support in the economic union's five partner states. Most Ugandans, Burundians, and Rwandans think a single currency is a good idea, but Tanzanians are divided, and a majority of Kenyans think it is a bad idea.
WASHINGTON, D.C. -- The East African Community's next goal after launching a common market in July -- creating a common currency by 2012 -- gets mixed support in the economic union's five partner states. Gallup surveys last year showed most Ugandans, Burundians, and Rwandans think a single currency is a good idea, but Tanzanians are divided, and the majority of Kenyans think it is a bad idea.
The economic union's leaders expect that swapping five different currencies and exchange rates for a single one will ultimately simplify cross-border trade in the East African Community (EAC) and encourage investment. For now, however, some financial analysts see these disparities as emerging obstacles. According to Kenya's Business Daily, all EAC countries will likely experience some economic losses with the currency switch. These losses may be heavier in countries with stronger currencies and larger economies, such as Kenya, where public opinion also happens to be the most negative about the idea of a single currency.
Gallup's data also show Kenyans and Tanzanians are less likely to see their countries gaining from the EAC in general, which could explain their lack of enthusiasm for a common currency. They are also less supportive of the formation of a new country, a step that could follow the monetary union's creation.
Perhaps not surprisingly, support for a single currency is higher among those who think the EAC should become one nation. More than 9 in 10 Burundians, Rwandans, and Ugandans who say the EAC should be a single nation support the idea of a single currency. Majorities of Tanzanians and Kenyans who support the single nation idea also support the single currency idea.
A potential downside of the EAC moving to a common currency is that each country will be unable to formulate its own monetary policy and deal with severe economic stress on its own. The Greek crisis earlier this year likely did little to ease skeptical Tanzanians' and Kenyans' minds about a single currency. EAC Secretary General Juma Mwapachu told Reuters the bloc was hoping to learn from the crisis in the euro zone and "ensure that we do not find any of our member states falling into the kind of experience that Greece has gone into." EAC leaders seeking buy-in from their public may also do well to stress what each country may gain, rather than lose, in the exchange.
For complete data sets or custom research from the more than 150 countries Gallup continually surveys, please contact SocialandEconomicAnalysis@gallup.com or call 202.715.3030.
Results are based on face-to-face interviews with 1,000 adults each in Burundi, Kenya, Rwanda, Tanzania, and Uganda. All respondents were aged 15 and older, and the surveys were conducted in Burundi in July and August, in Kenya in April, in Rwanda in August, in Tanzania in November, and in Uganda in May and June 2009. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error ranges from 3.5 percentage points in Burundi to 4.2 percentage points in Tanzania. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
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|Title Annotation:||East African Community|
|Publication:||Gallup Poll News Service|
|Date:||Sep 14, 2010|
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