cbk to recognize the payment of a return rather than interest on government securities with the aim of opening up a spectrum of shariah compliant investment in the country. similarly, section 16 of the banking act was amended to allow for payment of a return rather than interest on savings products in the banking industry. i therefore urge all the players in this sector to come up with innovative products and services so that kenya may achieve her ambition of becoming a financial hub in the region. the central bank of kenya will work with all the players in facilitating the achievement of this dream. ladies and gentlemen : sharia compliant banking, although still in its infancy in our country, has a lot of opportunity for growth. the two fully sharia compliant banks as at the end of february 2013 had a total of kshs. 15. 4 billion in loans and advances and kshs. 19. 5 billion in total deposits. furthermore, these two banks together with other conventional banks offering sharia compliant banking window had total deposits of sha. 27. 8 billion as at bis central bankers ’ speeches 31st december 2012. these numbers just show how sharia compliant banking is gradually becoming a major player in the banking sector. ladies and gentlemen : the introduction of these specialized products in the kenyan banking industry no doubt comes with its challenges. these include limited short term liquidity management products, lack of experienced human resources in this specialized banking & finance area, lack of product standardization which can be a cause of ambiguity and source of disputes to mention but a few. the central bank is currently formulating policy and regulations to regulate the sharia compliant products and therefore depart from the current practice of subjecting sharia compliant banking to conventional banking regulations. i urge all the shariah boards to work together to help find solutions or come up with suggestions on how to address these challenges. we at the central bank will be willing and happy to provide the necessary facilitation and share our views. ladies and gentlemen : the future of sharia compliant banking and finance in kenya is bright but the challenges that exist need to be tackled collectively. i urge all players in the sharia compliant banking to embrace the spirit of cooperation and competition as they come up with ways of product and service standardization. kenya has pioneered in sharia compliant banking in this region but other countries in the region are headed in that direction, with tanzania already having two fully sharia compliant banks. somalia is another country keen on modeling its emerging financial system predominantly along sharia compliance as it rec

njuguna ndung ’ u : consolidating economic integration in africa remarks by prof njuguna ndung ’ u, governor of the central bank of kenya, at the 9th meeting of the association of african central banks ( aacb ) eastern africa sub - region, nairobi, 14 july 2010. * * * hon. uhuru kenyatta, deputy prime minister and minister for finance of the republic of kenya ; fellow central bank governors of the eastern africa sub - region ; the executive secretary general of the aacb ; chief executives of regulatory authorities in kenya ; distinguished guests ; ladies and gentlemen : hon. deputy prime minister and minister for finance, allow me to thank you most sincerely for finding time from your busy schedule to grace this important meeting in the calendar of central banks in the eastern africa region. your presence here today demonstrates the serious commitment of the government of kenya to monetary and financial integration in the continent as we strive to become a regional financial hub in line with kenya ’ s vision 2030. for instance, just this month, we witnessed the launching of the implementation of the east african common market. may i also extend a hand of welcome to my fellow governors from the eastern africa subregion present here today. i heartily thank you for finding time to be in nairobi. this is indeed a very great honour to the central bank of kenya and our country. i also warmly welcome the executive secretary of the aacb whose presence and contributions in the deliberations we look forward to. we also appreciate the presence of the chief executives of other financial sector regulatory authorities in kenya, whose presence here today signifies the all important synergy required between the different regulators in the process of financial integration. hon. minister, the abuja treaty envisaged the integration of the african continent through, among others, the strengthening of the sub - regional groupings and harmonization of national policies for the eventual evolvement of a monetary union in the continent. in line with this, the assembly of governors in the continent have been implementing the african monetary cooperation programme ( amcp ) since they adopted it on september 4, 2002 in algiers. the objective of this program is to put in place a common single currency and a common single central bank at continental level by 2021, at the end of a successful convergence process, in accordance with the african leaders ’ vision of consolidating economic integration in africa. commendable progress in the implementation of the amcp by the eastern africa sub - region has