By Emma Ujah, Abuja Bureau Chief
The Governor of Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has been elected chairman of the West Africa Monetary Zone (WAMZ) at the ongoing sub-regional meeting in Abuja.
WAMZ consists of six countries, namely: Nigeria, The Gambia, Ghana, Guinea, Liberia and Sierra Leone.
In his acceptance speech, Emefiele said that “a lot of work needs to be done, especially in respect of the attainment of ECOWAS single currency by 2020.” He further noted that everything that is required to be done would be actualised towards achieving the objectives of the regional organisation.
While reiterating Nigeria’s unflinching commitment towards the single currency project in the sub-region, the CBN Governor urged member countries to work towards achieving the convergence criteria.
Meanwhile, Emefiele has cautioned member countries of WAMZ against rushing into a common monetary union and creating a common currency in the sub-region.
He stated: “Our desire for greater economic prosperity for our people through a common monetary union must not vitiate our awareness of the potential adverse and contagion factors associated with unified monetary area and common currency.”
He instead called for the establishment of a WAMZ Commission to drive common interests and aspirations of member countries.
“We must intensify our level of cooperation and collaboration through strong bonds to work as a unit within the ECOWAS monetary union programme to achieve our shared objective.
“It has become imperative for us to bring this collective resolve to bear as we embark on a thorough review of the economic conditions of member countries vis-a-vis their levels of preparedness for the monetary union and economic integration of the sub-region.
“The discussion should identify existing or potential impediments to the realization of the deadline for the commencement of the currency union. This is imperative in order for us to jointly find viable options in accelerating progress towards achieving the integration objective,” he said.
Director-General of West African Monetary Institute (WAMI), Dr. Mrs Ngozi Egbuna, disclosed that as at December, 2017, the assessment of member states’ performance on the primary convergence criteria showed that none of the countries met all the four primary criteria.
There are ten convergence criteria for the formation of the common currency in the zone, four categorized as primary and six as secondary.
The four primary criteria are: Single-digit inflation rate at the end of each year; Fiscal deficit of no more than 4% of the GDP; Central bank deficit-financing of no more than 10% of the previous year’s tax revenues; and Gross external reserves that can give import cover for a minimum of three months.