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Is SACU Ready for a Monetary Union?
This research paper evaluates the viability of the South African Customs Union (SACU) transitioning from a Common Monetary Area (CMA) to a full monetary union. Using Southern African Development Community (SADC) convergence criteria, the authors find that while there is strong convergence in inflation, debt, and reserves, significant fiscal deficits in Lesotho and Swaziland present a major hurdle. The paper suggests that a monetary union would be beneficial and that the South African Reserve Bank (SARB) is well-positioned to lead the process.
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Document type: Research paper
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