-Wants Member States Implement Fiscal, Monetary Exchange Rate Policies
A representative of the ECOWAS Commission, Gideon Gbappy who spoke recently at the mid-year statutory meetings of the 31st joint ordinary meeting of the Economic and Monetary Affairs Committee and operations and administration, reaffirmed the entity’s commitment to the West African Monetary Zone (WAMZ) integration agenda.
The overall objective of the meetings is to gauge and assess progress of member countries in the drive towards the establishment of a Common Central Bank and the introduction of a Single Currency, with a view to achieving monetary integration to ensure rapid socio-economic development through harmonized and sound fiscal and monetary policies in all member countries which include The Gambia, Ghana, Guinea, Liberia, Nigeria and Sierra Leone.
Mr. Gbappy highlighted the challenges faced by these countries at the domestic front, pointing out that the ECOWAS countries were contending with hikes in prices of basic commodities as a result of exchange rate depreciation and domestic food supply shocks.
“Despite these challenges, we will pursue policies to re-establish compliance with all four primary criteria, while improving performance on the secondary convergence scale and want member states to implement prudent fiscal, monetary and exchange rate policies as well as adopt policy measures aimed at enhancing revenue mobilization and diversification of regional economics,” he said.
However, Mr. Gbappy urged member states to accelerate efforts towards a more inclusive and greener economy and ensure the mainstream macroeconomic policy of ECOWAS and the United Nations Sustainable Development Goals into their national development planning.
He noted that despite the numerous challenges, ECOWAS commission remains committed to the monetary integration agenda and the sustainable development of our community.
The ECOWAS representative also revealed that the regional convergence criteria will help the region to introduce single currency in 2020 are yet to be implemented or completed.
Gbappy said the regional convergence profile is also far from satisfactory because progress towards sustained convergence in the region has been slow and mixed.
He added that the target date of 2020 set for the launching of the common currency for the region is now a daunting challenge, given that a substantial number of outstanding activities in the roadmap has not been implemented.
“To this end, the ECOWAS convergence council at its ninth statutory meeting last year in Abuja recommended a comprehensive review and costing of the roadmap of the single currency programme to determine the feasibility or otherwise of the year 2020 target date for the launch of the single currency.
“This study when done will determine whether the date stands or not. This study is very important to accelerate the project in order to clear some of this daunting challenge.
“And during this study, it will not in any way diminish the commitment and importance that the ECOWAS commission attached to ensuring accelerated progress towards convergence and sustained macroeconomic stability in the region,” he said.
He added that before the year comes to an end, the commission will be organizing a presidential task force to discuss the status of the implementation of the roadmap and other sailent uses relating to the single currency programme.
Meanwhile, Gbappy said the economic activities in the region has resulted into a serious deceleration of real GDP growth and heightened inflationary pressure in 2016 largely due to recession in Nigeria and exchange rate depreciation of some regional currencies.
He further explained that regional performance deteriorated marginally from what was achieved in 2015 beginning 2016, due to budget deficit experience in most member states.
Also, the inflation and reserve levels in months of import criteria were also not met by some member states as well, he said.
He assured colleague Governors of ECOWAS’ commitment to the proposed WAMZ Commission, and indicated that broad consultations would be held with relevant stakeholders to discuss the study done by WAMA and make their considerations known.