Common Monetary Area

Allied to SACU is the Common Monetary Area (CMA) which links South Africa, Lesotho and Swaziland into a Monetary Agreement, essentially the Southern African equivalent of the Franc Zone in West Africa. Namibia automatically became a member upon independence but withdrew with the introduction of the Namibian dollar in 1993. Namibia has chosen not to pursue its own flexible exchange-rate policy, and the Namibian dollar is at par with the rand and there is no immediate prospect of change. The same is true with the lilangeni of Swaziland and the loti of Lesotho. Although the rand is no longer legal tender in Swaziland and Lesotho, it still circulates freely in both countries. Foreign exchange regulations and monetary policy throughout the CMA continue to reflect the influence of the South African Reserve Bank.