ECOWAS Takes Decision On Single Currency

ECOWAS Takes Decision On Single Currency

The West African Monetary Zones (WAMZ) has hit roadblocks in its quest to adopt a single currency across member states, with the timeline for realization extending beyond initial expectations……READ ALSO Northern Senators Extend Gratitude: ECOWAS’ Move To Lift Sanctions On Niger Republic

During the 51st meeting of the Convergence Council of WAMZ held in Abuja over the weekend, Olorunsola Olofeso, the Director-General of the West African Monetary Institute (WAMI), disclosed this development.

Dr. Olofeso highlighted a decline in the key convergence indicators, critical benchmarks that member states must meet to achieve the monetary union. This setback raises concerns about the feasibility of introducing a unified currency in the near future, a goal that has been part of the region’s economic integration efforts for years.

The aspiration for a single currency aims to foster economic stability, enhance trade, and facilitate seamless transactions across West Africa. However, challenges such as varying economic policies, inflation rates, and fiscal deficits among member states have hindered progress in meeting these convergence criteria.

The meeting in Abuja convened finance ministers, central bank governors, and other stakeholders from the WAMZ member states to assess progress and strategize on overcoming existing challenges.

Dr. Olofeso stated, “The assessment of Member States’ performance reveals that as at the end of June 2023, all WAMZ Member States failed to meet all the four primary convergence criteria. The zone’s performance score declined to 29.2 per cent, compared to 41.7 per cent during the same period in 2022.”

He further added, “The medium-term projections on macroeconomic convergence… suggest that none of the WAMZ Member States will meet all the four primary convergence criteria on a sustainable basis for the remaining three consecutive years (2024-2026) of the convergence phase of the ECOWAS Single Currency Roadmap (2021-2027).”

Chairman of the Committee of Governors of WAMZ, Olayemi Cardoso, disclosed that the Committee directed the DG to present periodic comprehensive macroeconomic and convergence reports at the WAMZ Statutory meetings starting mid-year 2024. Additionally, WAMI was tasked with updating its database and convening seminars on topical issues to provide solutions to macroeconomic policy issues of member states.