ECOWAS leaders agree to single currency by 2020

The 4th meeting of the Presidential Taskforce on a common currency for the West African Monetary Zone (WAMZ) has taken place in Niamey, the capital of Niger, with the firm commitment towards the acceleration of the processes leading to the use of the single currency by 2020.

The meeting was attended by the members of the Presidential Taskforce, namely the President of Ghana, Nana Addo Dankwa Akufo-Addo; the President of the Federal Republic of Nigeria, Muhammadu Buhari; the President of Cote d’Ivoire, Alassane Ouattara; and the host, Mahamadou Issoufou, President of Niger.

Chairperson of the Economic Community of West African States (ECOWAS), Faure Essozimna Gnassingbé, President of the Togolese Republic, was also present, and took part in the proceedings.

In a communiqué issued at the end of the 1-day meeting, on Tuesday, 24th October, 2017, the members of the Taskforce took note of the report of the Ministerial Committee meeting held earlier, and acknowledged the quality of the conclusions as well as the relevance of the recommendations made, whose substantive parts relate to the measures for the acceleration of the ECOWAS single currency programme.

The Taskforce appreciated the progress made by all ECOWAS institutions involved in the conduct of ECOWAS Single Currency Roadmap activities, and reaffirmed its commitment to the pursuit and the acceleration of the economic, financial and monetary integration agenda of ECOWAS.

In endorsing the main recommendations of the Ministerial Committee, the Taskforce urged Member States to pursue the structural reforms of their respective economies, to help them deal with fluctuations in the prices of raw materials, and enable their economies to be more resilient to exogenous shocks.

Additionally, the Taskforce urged Member States to take the necessary measures, including the attainment of the convergence criteria, necessary for the creation of the ECOWAS single currency by 2020.

The Communiqué noted that the Taskforce has “instructed the Ministerial committee to meet within three months to propose a new roadmap to accelerate the creation of the single currency by 2020.

In this framework, a gradual approach can be undertaken, where a few countries, which are ready, can start the monetary union, whilst the other countries join later.” The Presidential Task Force will hold their next meeting in Accra, in February 2018.

Background

It will be recalled that at the Extraordinary Summit of Heads of State and Government on 25th October, 2013, the Presidents of Ghana and Niger were appointed to oversee the creation of the single currency in a timely manner.

The two Presidents constituted a Task Force, whose membership included representatives of the President of Ghana and Niger; Ministers of Finance of Ghana and Niger; Governors of the eight Central Banks of ECOWAS member States; ECOWAS and UEMOA Commissions; West African Monetary Agency (WAMA) and the West African Monetary Institute, to advise them periodically on the monetary integration programme.

The membership of the taskforce was reviewed in 2015 to include the Presidents of Cote d’Ivoire and Nigeria, as well as the Ministers of Finance of the two countries. The inaugural meeting of the Presidential Taskforce was held on 20th and 21st February, 2014 in Niamey.

Subsequently, two other meetings were held in Accra on 7th and 8th July, 2014, with the last meeting held in Niamey from 4th to 6th February, 2015.

The main objectives of the third meeting were to examine the revised roadmap on the realisation of the ECOWAS single currency by 2020; a proposal from the ECOWAS Commission on the creation of an ECOWAS monetary Institute by 2018; and the concern raised by the WAMZ Convergence Council on the revised macroeconomic criteria adopted by the 45th Ordinary Summit of the Heads of State and Government held in Accra on 10th July, 2014.

After the third meeting, it was agreed, amongst others, that the Central Bank financing criterion be reclassified as a primary criterion because of its strategic importance to monetary and price stability. The revised roadmap on the realisation of the ECOWAS single currency by 2020 was to be costed, and sources of funding identified.