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ECOWAS Monetary Agencies To Discuss Single Currency Readiness

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The central bank governors and monetary policy members of West African countries would next week discuss the readiness of Economic Community of West African States (ECOWAS)  member countries to meet the deadline for the introduction of the single currency by 2020.

Single currency discussion is part of the many issues to be addressed at the 2018 Mid-Year Statutory Meetings of West African Monetary Agency (WAMA), West African Monetary Zone (WAMZ) and West African Institute of Financial and Economic Management (WAIFEM) to be hosted by Nigeria next week.

The meeting is expected to review the progress made in the implementation of the ECOWAS Single currency roadmap, and the status of implementation of programmes under the ECOWAS Monetary Cooperation Programme (EMCP).

There is also expected to be a review of member countries compliance with the convergence criteria, harmonisation of payments system, harmonisation of monetary policy framework and exchange rate regimes, harmonisation of statistics, capital account liberalisation, financial integration as well as other administrative and governance issues in those Institutions among others.

The meeting would be preceded by the 33rd Joint Ordinary Meeting of the Economic and Monetary Affairs Committee and the Operations and Administration Committee of the West African Monetary Agency (WAMA) and the 38th Meeting of the Technical Committee of the West African Institute for Financial and Economic Management on September 9, 2018.

Also, the technical committee meeting of the WAMZ College of Supervisors (CSWAMZ) would hold along side the meetings.

The presidential taskforce on common currency for the West African Monetary Zone (WAMZ), had met earlier in the year in Niamey, Niger, re-affirming the commitment to accelerating the processes of the use of a single currency by 2020.

Amadou Diouf, an Economist from ECA West Africa speaking recently at a session of  Intergovernmental Committee of Experts for West Africa stated that many West African countries were yet to meet the macroeconomic convergence criteria for a single currency.

He said findings showed that many of the countries were yet to meet the macroeconomic convergence criteria for a single currency set up by the ECOWAS and the West African Monetary Agency (WAMA).

According to the report, the goal is to create a common currency for West Africa. For the currency to be implemented, 10 convergence criteria was set out by WAMA.

Part of the criteria for meeting single currency policy by African nations include single-digit inflation rate at the end of each fiscal year and deficit of not more than three per cent of the GDP.

The criteria also requires gross external reserves that could cover a country’s import bill for a minimum of three months and a tax revenue that is higher than 20 per cent of GDP amongst others.



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