The Genesis of Central Banking in Kenya, Tanzania and Uganda

A long period of British colonial rule came to an end in the early ‘60s, when the territories of East Africa, in the context of the decolonization trend, gained political independence and three new states could therefore emerge: the Republic of Kenya, the United Republic of Tanzania and the Republic of Uganda. These new African independent states could not accept to renounce the achievement of their full monetary sovereignty and this crucial choice, mainly due to political issues rather than economic reasons, marked the epilogue of the East African Currency Board, the former British colonial monetary institution of Eastern Africa which was providing a common currency directed to serve a common market for this African region. The article deals with the dramatic change in monetary and financial systems occurred in these African countries along with relevant decisions such as the liquidation of the East African Currency Board and giving up of a common monetary unit, the adoption separate currencies, of two-tiers banking systems and consequently the establishment, through acts of their parliaments, of the three apex monetary and banking institutions: the Central Bank of Kenya, the Bank of Tanzania and the Bank of Uganda