n AfricaGrowth Agenda - The common monetary area in southern Africa : key issues and policy implications

Volume 2013, Issue 7
  • ISSN : 1811-5187


The South African Reserve Bank (SARB) was established in 1921, after which, the then South African currency, pound (until 1961) became the medium of exchange and legal tender in South Africa (SA), Bechuanaland (now Botswana), Basutoland (now Lesotho), Namibia and Swaziland. The currency union was formally established on December 5, 1974, with the signing of the Rand Monetary Area (RMA) agreement. However, Botswana withdrew from the RMA in 1975 because it wanted to retain the ability to formulate and implement its own monetary policy and to adjust the exchange rate if necessary amid shocks that may affect its economy. The RMA agreement was revised in 1986 to establish the Common Monetary Area (CMA). Under this agreement, Swaziland and Lesotho were allowed to issue their own respective national currencies, the Lilangeni and the Loti in 1974 and 1980, respectively. Namibia joined the CMA in 1992 and issued its national currency, the Namibian Dollar in 1993. Under the terms of the CMA agreement, the national currencies of Lesotho, Namibia and Swaziland (LNS) have been pegged one-to-one to the SA Rand.

Loading full text...

Full text loading...


Article metrics loading...


This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error